Budget Overview
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Acknowledgments 3
A
CKNOWLEDGMENTS
The preparation of the city’s annual resource allocation plan requires a tremendous amount of hard work and
dedication on the part of many people. Developing expenditures and revenue information requires varying
sources of data and multiple perspectives.
The Proposed FY 2014 Budget includes the assistance of many who deserve acknowledgment and appreciation:
• Residents of the city and civic leagues, particularly those who attended community outreach meetings
• City employees who attend outreach meetings and submit their suggestions for improvement
• Executive budget team
• Department and office directors
• Members of the business community
• Council Appointees, especially the City Assessor
• Constitutional Officers, particularly the City Treasurer, and Commissioner of the Revenue
• Norfolk Redevelopment and Housing Authority
Special recognition and gratitude to the Office of Budget and Grants Management’s staff who worked to prepare
this year’s budget.
Office of Budget and Grants Management Staff
Sabrina Joy-Hogg, Director
Budget Team
Jose Benitez, Ryan Bergman, Marilyn Burress, Paris Colburn, Nikola Georgiev, Wayne Green, Patricia Harrison,
Alyson Lawson, Betty Meyer, Morgan Ramos, Tyler Roomsburg, Anil Ustun, and Andrew Yancey
Grants Team
Taylor Brinkley, Kathleen Broughton, Leila LaRock, Gregory Patrick, and Kimberley Pierce
City Manager
Marcus D. Jones
4 Distinguished Budget Presentation Award
D
ISTINGUISHED
B
UDGET
P
RESENTATION
A
WARD
The Government Finance Officers Association of the United States and Canada (GFOA) presented an award of
Distinguished Presentation to the City of Norfolk, Virginia for its annual budget for the fiscal year beginning July 1,
2012. The review process by GFOA has not commenced for the annual budget for the fiscal year beginning July 1,
2013.
This prestigious award is presented to governmental entities that prepare budget documents which exhibit the
highest qualities in meeting or exceeding both the guidelines established by the National Advisory Council on
State and Local Budgeting and GFOA’s standards of best practices. Documents submitted for the Budget Awards
Program are reviewed by selected members of the GFOA professional staff and by outside reviewers with
experience in public-sector budgeting. The award is valid for a period of one year only. The FY 2014 budget
continues to conform to program requirements and will be submitted to GFOA for eligibility.
City of Norfolk Government 5
C
ITY
OF
N
ORFOLK
G
OVERNMENT
Norfolk City Council is the legislative body of the city government. It is authorized to exercise all the powers
conferred upon the city by the Commonwealth of Virginia in the state constitution, state laws and the Charter of
the City of Norfolk.
City Council is composed of eight members. Seven members are elected through a ward system, and the Mayor is
elected at large by the residents of Norfolk. These members elect a vice president (Vice Mayor) of the Council. For
further information on the duties, powers and meetings of the Council, call the Office of the City Clerk 757-664-
4253.
The City Council meets the second and fourth Tuesday of each month in the Council Chambers in Norfolk City Hall.
There are two formal meetings a month held at 7:00 p.m. On the first Tuesday of the month, there is a Council work
session held at 2:00 p.m.
The City of Norfolk operates under a Council-Manager form of government whereby the Council appoints a chief
executive, the City Manager, Marcus D. Jones. The Council also appoints a City Attorney, Bernard A. Pishko; City
Clerk, Breck R. Daughtrey; Real Estate Assessor, Deborah Bunn; and City Auditor, John Sanderlin.
6 City of Norfolk City Council Members and City Manager
C
ITY
OF
N
ORFOLK
C
ITY
C
OUNCIL
M
EMBERS
AND
C
ITY
M
ANAGER
Mayor
Paul D. Fraim
Vice-Mayor
Anthony L. Burfoot
Ward 3
Council Member
Andrew A. Protogyrou
Ward 1
Council Member
Dr. Theresa W. Whibley
Ward 2
Council Member
Paul R. Riddick
Ward 4
Council Member
Thomas R. Smigiel
Ward 5
Council Member
Barclay C. Winn
Ward 6
Council Member
Angelia M. Williams
Ward 7
City Manager
Marcus D. Jones
City of Norfolk Ward Map 7
C
ITY
OF
N
ORFOLK
W
ARD
M
AP
8 City Council’s Vision of Norfolk
C
ITY
C
OUNCIL
’
S
V
ISION
OF
N
ORFOLK
The City of Norfolk continues to remain true to its vision. In the early 1990’s, City Council established the vision of
Norfolk and the current City Council and City Administration remain committed to executing and maintaining the
vision.
Vision
Norfolk is a national leader in the quality of life offered to all its citizens.
This is achieved through effective partnerships between city government and its constituents.
As a result, Norfolk is a physically attractive, socially supportive, and financially sound city.
Here, the sense of community is strong.
Neighborhoods are designed so that people of all ages can know their neighbors and travel the streets and
sidewalks in safety.
A sense of community exists citywide.
Norfolk is known nationally as a strategically located place where there is abundant and fulfilling employment,
recreational, and educational opportunities.
Priorities
• Accessibility, Mobility and Connectivity - A comprehensive network of accessibility and information gathering
options, addressing all traditional transportation modes as well as new technologies that connect people, goods
and information.
• Economic Vitality and Workforce Development - A growing, competitive and diversified economy that
enhances the quality of life for residents through a wide range of housing, shopping, educational, cultural,
business, and employment opportunities.
• Environmental Sustainability - A premier waterfront community that creates a positive, regenerative effect on
its environment avoids detrimental environmental impacts and thrives economically and culturally.
• Lifelong Learning - Residents of all ages enjoy a culture of learning that enables them to reach their full
potential, achieve personal goals, and through their knowledge, skills abilities, and talents, become well
equipped to support a prosperous economy.
• Safe, Healthy and Inclusive Communities - Residents of diverse backgrounds and interests feel encouraged
and empowered to assist in the development of safe and healthy neighborhoods thereby fostering a culture of
leadership, pride and well-being that advances Norfolk’s brand as a desirable and enjoyable place to live, learn,
work and play.
• Well-Managed Government - A data-driven organization that provides effective and efficient programs and
services that are responsive, accountable, and inclusive and customer focused.
City of Norfolk Organizational Chart 9
C
ITY
OF
N
ORFOLK
O
RGANIZATIONAL
C
HART
Residents of Norfolk
City Councily
Constitutional Officers and
other Local Officials
• City Treasurer
• Clerk of the Circuit Court• Clerk of the Circuit Court
• Commissioner of the Revenue
• Commonwealth’s Attorney
• Courts
• Magistrate
• Norfolk Juvenile Court Service Unit
• Sheriff
Council Appointees City Manager
Appointed Boards
• Registrar*
• City Attorney
• City Auditor
• City Clerk
• City Real Estate
Assessor
• Norfolk Public Schools
• Norfolk Redevelopment
and Housing Authority
• Norfolk International
Airport
City Departments
• Communications and Technology
• Cultural Facilities, Arts and Entertainment
• Development
•Emer
gency Preparedness and Response
• Libraries
• National Maritime Center
• Norfolk Community Services Board
• Plannin
g and Community Development
gy p p
• Executive
• Finance
• Fire-Rescue
• General Services
• Human Resources
• Human Services
gyp
• Police
• Public Health
• Public Works
• Recreation, Parks and Open Space
• Utilities
•Zoo
*Appointed by State Board of Elections
10 Reader's Guide to the Budget
R
EADER
'
S
G
UIDE
TO
THE
B
UDGET
P
URPOSE
The budget is an instrument that sets policy and summarizes public service programs provided by the city
government and how the programs are funded. It is the annual plan for coordinating revenues and expenditures.
The budget presented covers the period of July 1, 2013 to June 30, 2014. The amounts for FY 2014 are approved
through the appropriation ordinance adopted by the City Council. The approved FY 2014 amounts may include
technical changes made after the City Manager’s presentation of the proposed operating budget to the City
Council.
B
UDGET
O
VERVIEW
This section provides information on budget and financial policies, fund structures, basis of accounting, the budget
process, budget calendar, and the city’s organizational chart. The section also includes revenue and expenditure
summaries, discussion of major revenue sources, indebtedness, and personnel staffing. Historical revenue and
expenditure amounts for FY 2012 provided in the summaries do not include designations and financial
adjustments posted after June 30, 2012.
G
ENERAL
F
UND
R
EVENUE
AND
E
XPENDITURE
The General Fund is used to account for primary government services. A summary of historical and estimated
revenue from each source is provided for the General Fund. For each department within the General Fund, a
summary of historical and approved expenditures is provided. Historical revenue and expenditure amounts for FY
2012 do not include designations and financial adjustments posted after June 30, 2012.
D
EPARTMENT
B
UDGETS
This section provides detailed information on the approved budget of each department within the General Fund.
Historical revenue and expenditure amounts for FY 2011 and FY 2012 provided in the department summaries do
not include designations and financial adjustments posted after June 30.
E
DUCATION
F
UNDS
This section provides information on the approved appropriation for Norfolk Public Schools.
S
PECIAL
R
EVENUE
, E
NTERPRISE
,
AND
I
NTERNAL
S
ERVICE
F
UNDS
These sections provide detailed information on the approved budgets of the city’s Special Revenue, Enterprise and
Internal Service Funds. Historical revenue and expenditure for FY 2011 and FY 2012 provided in the department
summaries do not include designations and financial adjustments posted after June 30.
Reader's Guide to the Budget 11
C
APITAL
I
MPROVEMENT
P
LAN
This section provides detailed budget information on the five-year Capital Improvement Plan. However, the only
year of the plan that is certain is the current budget year, FY 2014, with future years reflecting planning and not
commitment.
A
NNUAL
P
LAN
- H
OUSING
AND
U
RBAN
D
EVELOPMENT
(HUD) E
NTITLEMENT
G
RANT
P
ROGRAM
This section contains the Annual Plan for the Community Development Block Grant, HOME Investment
Partnerships Program, and Emergency Solutions Grant Program. The Annual Plan identifies the annual funding of
the city’s priority community development projects and activities as outlined in the five-year Consolidated Plan. FY
2014 approved amounts may include technical changes made after the City Manager’s presentation of the
proposed budget to the City Council.
M
ISCELLANEOUS
S
TATISTICAL
/G
ENERAL
I
NFORMATION
This section provides statistical/general information about the city such as an overview of the organization,
services and selected functions.
G
LOSSARY
/I
NDEX
The glossary provides definitions of budget-related terminology. The index contains an alphabetical reference of
information contained in this document.
12 Financial Policies
F
INANCIAL
P
OLICIES
O
PERATING
B
UDGET
The operating budget for the city is developed pursuant to Section 67 of the Charter of the City of Norfolk, Virginia.
In accordance with the City Charter, the City Manager must submit to the City Council, no less than 60 days before
the end of the fiscal year, a proposed operating budget for the ensuing fiscal year. The operating budget includes
proposed expenditures based on detailed estimates furnished by departments and other divisions of the city
government. The budget is presented in a manner that identifies recommended appropriations, taxes, and
estimated revenues with comparative statements. The budget is prepared by fund and department.
Following the formal presentation of the Proposed Budget by the City Manager, a public hearing is conducted to
provide an opportunity for the public to make comments on the proposed operating budget and any proposed tax
and fee adjustments, including the proposed real estate tax rate. The public hearing for the operating budget shall
be held at least seven days prior to City Council’s approval of the budget. City Council is required to approve a final
operating budget no later than 30 days before the end of the current fiscal year.
The formal approval of the budget is executed by the adoption of the ordinance delineating appropriations by
fund. Additional budgetary controls are exercised administratively on an appropriation unit basis over
combinations of object categories (account groups: personal services, materials, supplies and repairs, general
operations and fixed charges, equipment, public assistance, all purpose appropriations and debt service), as well as
on a line item basis over individual objects (budgetary accounts). Departments may transfer funds within a
departmental budget with approval from the City Manager or the Office of Budget and Grants Management.
The City Manager or designee is authorized to transfer from any department, fund, activity which has an excess of
funds appropriated for its use to any department activity or fund all or any part of such excess. Basic policies and
guidelines for the development of the city’s annual budget are provided below.
The administration is committed to high standards of financial management and currently maintains and follows
financial practices and guidelines. To further strengthen the city’s financial position and support the “well-
managed government” initiative, a comprehensive review and revision of the city’s financial practices and policies
is underway, which include a plan to meet the goals of our General Fund reserves. The Administration is in the
process of requesting adoption of formal financial policies by City Council. Financial policies demonstrate
commitment to consistent financial practices, operational efficiencies and best practices; preserve fiscal integrity;
and improve fiscal stability, which promote long-term fiscal sustainability. Sound financial management practices
contribute to maintaining high city bond ratings and lower borrowing costs for capital projects.
G
ENERAL
F
UND
B
ALANCE
R
ESERVES
Annually, after the close of the fiscal year, the Department of Finance must produce a schedule of all fund variances
to the final budget. Analysis of compliance with the city’s reserve requirements and a plan for the use of excess
funds is included in a year-end report submitted by the City Manager to the City Council. The City Manager may
recommend policy or procedure changes based upon circumstances identified in the year-end analysis.
The purpose of a reserve is to act as the city’s “savings” account to meet emergency and unanticipated needs
without jeopardizing the ongoing provision of city services. The establishment and maintenance of general
operating reserves is considered one of the most effective management practices a local government can employ.
Reserves help to cushion against annual cash flow disruptions. The appropriate size of reserves depends on
Financial Policies 13
variability of revenues and expenditures and the city’s cash flow needs. The General Fund reserve policy and
practices include the following:
Unassigned General Fund Balance (‘five percent reserve”) – The city maintains an unassigned General Fund
balance equal to at least five percent of the annual General Fund budget to help mitigate current and future risks
and provide temporary funding for unforeseen emergency or catastrophic needs. The FY 2013 goal of $40,157,373
is based on the FY 2013 General Fund Budget of $803,147,469, which reflects the City Council amendment to the
Norfolk Public Schools operating budget totaling $3,356,660. With the decline in the General Fund budget in FY
2011 and FY 2012, the amount needed to maintain the unassigned fund balance at five percent of the budget
declined as well. However, in FY 2011, City Council elected to add approximately $2.0 million to the unassigned
general fund balance to strengthen reserves and maintain the balance at the FY 2010 level of $41,559,263.
Moreover, during FY 2012, City Council allocated $773,328 of the FY 2011 surplus to raise the unassigned General
Fund balance to $42,332,591 to further strengthen reserves. As a result, the unassigned General Fund balance
currently exceeds five percent of the budget.
Risk Management Reserve – The city is self-insured for many of its risk exposures. The city has targeted a reserve
equal to 1.5 times the annual risk management budget of approximately $7.7 million in the event of major
unanticipated workers compensation or general liability claims. The Risk Management Reserve was enhanced in
FY 2010 by $1,058,409 to $1,898,571, and during FY 2012, City Council allocated $1,101,429 of the FY 2011 surplus
to strengthen reserves, raising the Risk Management Reserve to $3.0 million.
Economic Downturn/Leveling Reserve – The city strives to meet the goal of a $10 million reserve to abate the
impact of short-term economic downturns on the overall budget and to build adequate reserves to transition the
impact of extreme swings in revenues and/or expenditures such as retirement contribution, health insurance or
unforeseen emergencies. During FY 2012, City Council allocated $1.0 million of the FY 2011 surplus to the
Economic Downturn/Leveling Reserve to strengthen reserves, raising the reserve from $2.0 million to $3.0 million.
Amounts in the table above exclude reserves for encumbrances and other legally restricted reserves and
designations. Under GASB 54, the classification of the “five percent reserve” and the Economic Downturn/Leveling
Reserve was changed to unassigned General Fund balance from unreserved undesignated fund balance and
unreserved designated fund balance, respectively.
Reserve Purpose
Goal
FY 2013
Projected
FY 2013
Unassigned
General Fund
Balance
(“five percent
reserve”)
Good management practices recommend the
accumulation of undesignated funds to mitigate
current and future risks and to provide for
temporary funding of unforeseen emergency or
catastrophic needs.
$40,157,373 $42,332,591
Risk
Management
Reserve
Because the city is self-insured, a reserve is needed
in the event of major unanticipated workers
compensation or general liability claims.
$11,600,000 $3,000,000
Economic
Downturn/
Leveling Reserve
To abate the impact of short-term economic
downturns on the overall budget and to build
adequate reserves to transition the impact of
extreme swings in revenues and/or expenditures.
The reserve is intended to be used as needed
whereas the “five percent reserve” is to be used for
catastrophic needs or unforeseen emergencies.
$10,000,000 $3,000,000
14 Financial Policies
D
EFINITION
AND
U
SE
OF
S
URPLUSES
The budget prioritizes and plans the use of financial revenues based on the best data available at the time the
budget is approved. Budgeted revenues and expenditures are projections and are not exact. Through strict
monitoring, funds in excess of the budget projections may occur and are referred to as surpluses. In terms of
budget forecasts, the Commonwealth of Virginia has a goal or benchmark to be within two percent of the projected
budget.
The city uses surpluses to meet the aforementioned reserve goals, reduce outstanding debt and avoid future debt.
• Retirement of Existing Debt: excess surplus amounts may be used to pay principal on existing revenue bonds or
any other existing debt;
• Capital Replacement Programs: excess surplus amounts may be used to provide cash funding for certain capital
equipment replacement programs; or,
• Cash Payments for Capital Improvement Projects: excess surplus amounts may be used to provide cash funding
for Capital Improvement projects, thereby reducing the future debt burden upon the city.
To the same extent that the City Administration attempts to match one-time revenues with one-time expenses, a
one-time surplus is also matched with one-time expenditures. However, these unprecedented economic times
have lead the city to generate and use one-time budget savings to help balance the upcoming year’s budget.
D
EBT
M
ANAGEMENT
The Commonwealth of Virginia imposes a legal limit of ten percent of the assessed valuation of taxed real property
as a ceiling on the amount of general obligation borrowings. Based on this legal limit, the city can issue debt in
excess of $950 million (see City Indebtedness section). While this is the legal limitation, the city is well aware it
cannot take on expenditures beyond its fiscal means of affordability. Therefore, the city strives to adhere to the
following internal debt ratios to guide the development of the Capital Improvement Plan :
• Debt Service as a percent of the General Fund budget should not exceed ten percent; and,
• Net debt as a percent of taxable real estate should not exceed 3.5 percent.
In determining general obligation debt limitations, certain classes of indebtedness may be excluded, such as:
revenue anticipation notes maturing in one year or less; general obligation bonds payable from a specified revenue
producing undertaking so long as the undertaking is self-supporting; capital leases; and revenue bonds. The city’s
enterprise operations for Water, Wastewater and Parking’s bonded debt are a combination of self-supporting,
general obligation and revenue bonds. The city’s operation for Storm Water’s bonded debt is self-supporting
utilizing general obligation bonds.
The city has never defaulted on the payment of either principal or interest on any debt.
C
APITAL
I
MPROVEMENT
P
LAN
The city uses several guiding principles and best practices to manage the Capital Improvement Plan (CIP). The
principles (see Guiding Principles under CIP section) that govern the CIP are intricately intertwined with the debt
management practices mentioned in the previous section. Using the principles as a foundation, the CIP is
Financial Policies 15
developed to promote capital infrastructure that support the City Council’s priorities by establishing a five-year
capital implementation plan. In formulating this long range plan, input is solicited from various parties such as city
departments, City Council, citizens and businesses.
The CIP includes projects that meet the following City Council priority areas (see CIP section for definitions):
• Accessibility, Mobility and Connectivity
•Economic Vitality and Workforce Development
•Environmental Sustainability
• Lifelong Learning
• Safe, Healthy and Inclusive Communities
• Well-Managed Government
In addition, approved projects must also meet the minimum cost threshold of $50,000 and should extend the
useful life of an existing asset or create an asset with a useful life that exceeds the life of the debt instrument used
to finance the project.
Various sources of funding are used to fund the CIP. These sources include General Fund supported debt and non-
general fund supported debt, such as, revenue bonds or cash contributions from various resources. For general
capital improvements, the city strives to achieve an annual pay-as-you-go cash contribution of 12.5 percent for the
CIP. However, as in other cities, it has been a challenge to achieve this goal during these unprecedented economic
times. Nevertheless, the city is committed to achieving this goal and to becoming a Well-Managed Government.
16 Fund Structure
F
UND
S
TRUCTURE
The city uses fund accounting to ensure and demonstrate compliance with finance-related legal and regulatory
requirements. A fund is a grouping of related accounts used to maintain control over resources that have been
segregated for specific activities or objectives. The city’s funds can be divided into four categories: governmental
funds, proprietary funds, component unit funds and fiduciary funds.
G
OVERNMENTAL
F
UNDS
Governmental funds consist of the General Fund, Special Revenue Funds, Capital Project Fund, Debt Service Funds
and Permanent Fund (see following section). Most governmental functions of the city are financed through these
funds. Governmental funds normally are supported by taxes and intergovernmental revenues. The modified
accrual basis of accounting is used for the budgets of all governmental funds.
General Fund
The general operating fund of the city accounts for all financial transactions of the general government, except
those required or preferred to be accounted for in another fund. The General Fund accounts for the normal
recurring activities of the city, such as police, public works, general government, etc. These activities are funded by
such revenue sources as general property taxes, other local taxes, licenses and permits, fines and forfeitures, use of
money and property, charges for services, recovered costs and non-categorical aid, shared expenses and
categorical aid from the Commonwealth and Federal Government.
Special Revenue Funds
The Special Revenue Funds account for the proceeds of specific revenue resources that are restricted or committed
to expenditure for specific purposes (other than expendable trusts or major capital projects) and require separate
accounting because of legal or regulatory provisions, or administrative action.
Capital Project Fund
The Capital Project Fund accounts for the acquisition, construction or renovation of major capital facilities of the
city and the School Board.
P
ROPRIETARY
F
UNDS
The city maintains two types of Proprietary Funds: Enterprise Funds and Internal Service Funds. Proprietary Funds
account for operations similar to those found in the private sector, and they include the Parking Facilities,
Wastewater Utility, Water Utility, and Fleet Management Funds. The Proprietary Fund measurement focus is based
upon determination of net income, financial position and changes in financial position. The full accrual basis of
accounting is used to budget for all Proprietary Funds.
Enterprise Funds
Parking Facilities Fund
This fund accounts for the operation of city-owned parking facilities (garages, lots and on-street meters). The cost
of providing services is financed or recovered through user charges for long-term and short-term customer use and
fines for parking violations.
Wastewater Utility Fund
This fund accounts for the operation of the city-owned wastewater (sewer) system. The cost of providing services is
financed or recovered through user charges to Norfolk residential and commercial customers.
Fund Structure 17
Water Utility Fund
This fund accounts for the operations of the city-owned water system. The cost of providing services is financed or
recovered through user charges to customers. These customers include Norfolk residential, commercial
customers, the U.S. Navy, and other regional localities.
Internal Service Funds
Fleet Management Fund
Fleet Management provides maintenance, repair and service for the city fleet of vehicles, heavy equipment and
miscellaneous machinery on a cost reimbursement basis.
Storehouse Fund
Storehouse acquires and issues to city departments materials, parts and supplies which are used in the same form
as purchased. Beginning in FY 2014, the Storehouse will be decentralized and purchases will be procured and
monitored by individual departments.
Healthcare Fund
This fund accounts for the financing of medical costs provided to employees by the Norfolk Healthcare Consortium
through a health insurance plan. Employees and the Norfolk Healthcare Consortium share the cost of a monthly
health insurance premium, which is charged from departmental appropriations and employee paychecks into the
Healthcare Fund. Claims and wellness program expenditures are paid by the Healthcare Fund.
C
OMPONENT
U
NIT
F
UNDS
Education
The city’s total budget includes the funds of the Norfolk Public Schools. The primary sources of revenue, exclusive
of the transfer from the city’s General Fund, are basic school aid and sales tax revenues from the State and
educational program grants. Major expenditures are for instructional salaries and schools’ facility operating costs.
School Operating Fund
The School Operating Fund is the General Fund of the School Board. It accounts all financial resources except those
required to be accounted for in another fund, such as, Schools Grants and School Nutrition Services.
School Grants
This fund accounts for revenues and expenditures for Federal, State and other grants for educational programs.
School Nutrition Services
This fund supports the school breakfast and lunch program. School Nutrition Services is a self-funded operation
supported through cafeteria sales and federal and state reimbursements.
F
IDUCIARY
F
UNDS
AND
P
ERMANENT
F
UND
Fiduciary funds are used to account for resources held for the benefit of parties outside the city. The fiduciary
funds include the city’s Pension Trust Fund, the Commonwealth of Virginia Agency Fund and the Miscellaneous
Agency Fund. The permanent fund is used to report resources that are legally restricted to the extent that only
earnings (not principal) may be used to support the program. The permanent fund includes the Cemetery
Perpetual and Endowed Care. Fiduciary and permanent funds are not included in the city government’s budget or
financial statements, because the resources in such funds are not available to support the city’s programs.
Fiduciary fund statements are presented separately within the city’s Comprehensive Annual Financial Report.
18 City of Norfolk Fund Structure
C
ITY
OF
N
ORFOLK
F
UND
S
TRUCTURE
All City Appropriated
Funds
Governmental
Funds
Proprietary
Funds
General Fund
Central Appropriations
Circuit Court Judges
City Attorney
Special Revenue
Funds
Cemeteries
Capital
Projects Fund
Internal Service
Funds
Fleet
Management
Enterprise Funds
Water Utility
City Attorney
City Auditor
City Clerk
City Council
City Manager
City Real Estate Assessor
City Treasurer
Clerk of the Circuit Court
Cii fh
Golf Operations
Emergency
Preparedness and
Response
Healthcare
Wastewater
Utility
Parking Facilities
Storehouse*
Commissioner of the
Revenue
Commonwealth’s
Attorney
Communications and
Technology
Cultural Facilities, Arts &
Entertainment
Debt Service
l
p
Public Amenities
Norfolk Community
Services Board
Development
Elections
Finance
Fire-Rescue
General District Court
General Services
Human Resources
Human Services
Tax Increment
Financing
Storm Water
Management
Juvenile and Domestic
Relations Court
Libraries
Magistrate
Norfolk Juvenile Court
Service Unit
Norfolk Public Schools
Office of Budget and
Grants Mana
gement
Towing and
Recovery Operations
g
Office to End
Homelessness
Outside Agencies
Planning and Community
Development
Police
Public Amenities
Public Health
Public Works
Recreation, Parks and
Open Space
Sheriff and Jail
Tax Incentive
Zoological Park
*Decentralized as of July 1, 2013
Basis of Budgeting and Accounting 19
B
ASIS
OF
B
UDGETING
AND
A
CCOUNTING
B
ASIS
OF
B
UDGETING
The budgets of governmental fund types (General Fund, Special Revenue and Capital Projects Funds) of the city are
generally prepared on the modified accrual basis of accounting. The accrual basis of accounting is generally used
to budget for the Enterprise Funds and Internal Service Funds, except for depreciation, debt principal payments,
capital outlay and contractual commitments (see Basis of Accounting below).
For the modified accrual basis, expenditures are recorded as expenditures when the related fund liability is
incurred (other than interest on general long-term liabilities). For budgetary purposes, purchase orders issued and
other contractual commitments are considered expenditures when executed. Revenues are recorded when they
are measurable and available. The accrual basis recognizes expenses when the liability is incurred regardless of the
related cash flows. Revenues, however, are recognized when earned. The accrual methodology is based upon
known present and future expenses and revenues, not upon cash spent or received.
The level of control at which expenditures may not exceed the budget, is at the department level for the General
Fund and fund level for all other funds. Any change in appropriation level of the fund must be approved by City
Council. The City Manager or designee is authorized to transfer from any department, fund or activity which has an
excess of funds appropriated for its use, to any department, activity or fund all or any part of such excess.
Appropriations lapse at the end of the fiscal year, except appropriations for Grants (Special Revenue) and the
Capital Improvement Program, which are carried forward until the grant or project is completed or terminated.
B
ASIS
OF
A
CCOUNTING
The Comprehensive Annual Financial Report (CAFR) presents the status of the city’s finances in accordance with
Generally Accepted Accounting Principles (GAAP). In most cases this conforms to how the city prepares its budget.
Exceptions are as follows:
Compensated absences are recorded as earned by employees (GAAP basis), as opposed to being expended when
paid (Budget basis);
Principal payments on long-term debt within the Proprietary Funds reduce the amount of debt remaining on a
GAAP basis as opposed to being expended on a Budget basis;
Capital Outlay within the Proprietary Funds is recorded as assets on a GAAP basis and expended on a Budget basis;
Depreciation expenses are recorded on a GAAP basis only; and,
Recording unfulfilled purchase orders and contractual obligations as expenditures in the year executed.
In addition to the fund financial statements, government-wide financial statements are also prepared on the
accrual basis of accounting. In government-wide financial statements, certain funds are grouped together for
reporting purposes.
20 Budget Process
B
UDGET
P
ROCESS
F
ORMULATION
OF
THE
C
ITY
M
ANAGER
’
S
B
UDGET
The City Charter requires the City Manager to prepare and submit to the City Council an annual budget.
The annual budget process commences each fall. The budget calendar is developed which establishes the
timelines for the process, including dates for submission of departmental requests, budget work sessions and
public hearings that lead to final adoption of the budget.
Department requests are based on budget instructions. Each request must relate to the organization’s program
objectives and the priorities of the city. The requests are received and compiled by the budget staff. Due to
revenue constraints, departments are generally encouraged to develop proposals to realign or reduce
expenditures rather than seek additional funding.
An operating budget is adopted each fiscal year for the General Fund, Water Utility Fund, Wastewater Utility Fund,
Parking Fund, Storm Water Management Fund, Special Revenue Funds (Cemeteries, Emergency Preparedness and
Response, Golf Operations, Public Amenities, Tax Increment Financing, and Towing and Recovery Operations), and
Internal Service Funds (Fleet Management, Storehouse, and Healthcare Fund). Budgets are also individually
adopted within the Special Revenue (Grants) Fund. Ordinances are generally approved when a grant to the city has
been awarded.
All funds are under formal budgetary control, the most significant of which is the General Fund. No less than sixty
days before the end of the current fiscal year, the City Manager submits to the City Council a proposed operating
budget for the next fiscal year. The Operating Budget includes recommended expenditures and the means to
finance them. The Approved Budget may include technical changes made after the City Manager’s presentation of
the proposed budget to City Council.
C
ITY
C
OUNCIL
’
S
A
UTHORIZATION
AND
A
PPROPRIATION
After general distribution of the proposed operating budget, one or more public hearings may be conducted to
obtain comments and recommendations from the public. No less than thirty days before the end of the fiscal year,
the City Council shall pass an annual appropriation ordinance which shall be based on the budget document
submitted by the City Manager. The annual operating budget ordinance appropriates funds, based on the budget
document submitted by the City Manager and any subsequent changes made by the City Council, subject to
certain conditions, for use by departments. The ordinance appropriates funding for salaries, benefits and positions
as set forth in the detailed budget document. Amounts appropriated to each department are to be expended for
the purposes designated by object group, i.e., categories including: personnel services; materials, supplies and
repairs; general operations and fixed charges; equipment; public assistance; department specific appropriation;
and debt service.
C
ITY
M
ANAGER
’
S
A
UTHORIZATION
In accordance with the City Charter, at least sixty days before the end of each fiscal year, the City Manager shall
prepare and submit to the City Council an annual budget for the ensuing fiscal year. The budget shall be balanced
at all times. The total amount of appropriations shall not exceed the estimated revenues of the city.
Budget Process 21
In a given year, the City Manager or designee is authorized to transfer from any department, fund or activity which
has a budgetary excess of funds appropriated to any department, fund or activity as necessary.
B
UDGET
I
MPLEMENTATION
Once the budget is adopted, it is effective on July 1 and becomes the legal basis for the programs of each
department of the city during the fiscal year. No department or other agency of the city government may spend in
excess of approved and appropriated amounts. Financial and programmatic monitoring of departmental activities
to ensure conformity with the budget takes place throughout the year. Copies of the budget can be found in the
libraries, on the city website, or may be obtained from the Office of Budget and Grants Management. The City
Manager is responsible for maintaining a balanced budget at all times. In the event a gap is identified between
revenues and expenditures, the City Manager will take such actions necessary to rebalance the budget. Budget
amendments may be made by City Council in order to meet the changing needs of the city. The means by which
City Council may amend the budget include, but are not limited to, appropriation of additional funds and
decreasing the amount of appropriated funds.
C
APITAL
I
MPROVEMENT
P
LAN
AND
C
ONSOLIDATED
P
LAN
City Council also adopts a Capital Improvement Plan Budget and a Consolidated Plan Budget. As in the case of the
Operating Budget, these budgets are submitted by the City Manager, public hearings are held, and the budgets are
legislatively enacted through adoption of ordinances.
Appropriations for project funds and grant funds do not lapse at year end, but continue until the purpose of the
appropriation has been fulfilled or is otherwise terminated. Amendments to these budgets may be affected by
City Council action. The level of budgetary control is on a project basis with additional administrative controls
being exercised.
B
UDGETARY
P
RINCIPLES
AND
P
OLICIES
Budgetary principles and policies include:
• Provisions to strive for a structurally balanced budget whereby ongoing expenditures are supported by ongoing
revenues;
• Preparation of a mid-year budget update, reporting projected revenues and expenditures for the entire fiscal
year and receipt of unbudgeted revenues and other major changes to the adopted budget;
• Preparation of a five-year forecast, which serves as the basis for the City Manager’s annual recommended
budget; and
• Requirement that the City Manager prepare a Five-Year Capital Improvement Plan that incorporates operating
costs and is stated in “year of expenditure dollars.”
22 Budget Calendar
B
UDGET
C
ALENDAR
Date Responsible Party Description Legal Requirement
September 2012 City Departments
Departments Submit Capital Improvement
Budget Requests
October 2012 City Departments Departments Submit Operating Requests
November 2012
Budget Office
Executive Staff
City Department
Department Meetings with Budget Staff
and Executive Budget Team
February - March
2013
Communications
Budget Office
Executive Staff
Budget Community and Employee
Outreach Program
April 1, 2013 Norfolk Public Schools
School Board Presents Proposed Operating
Budget to City Council
Code of Virginia
15.2-2503
April 16, 2013 City Manager
City Manager Presentation of Proposed
Budget to City Council
City of Norfolk
Charter Sec. 67
April 17, 2013 City Clerk
Public Hearing Notice of the Operating and
Capital Improvement Plan Budgets, HUD
Grants (CDBG, ESG and HOME), Real Estate
Tax
Code of Virginia
15.2-2506,
U.S. Department of
Housing and Urban
Development (HUD)
April 23, 2013 City Council 1
st
City Council Work Session
April 24, 2013 City Council
Public Hearings on the Operating, Capital
Improvement Plan and HUD Grant (CDBG,
ESG and HOME) Budgets
Code of Virginia
15.2-2506
May 1, 2013 City Council Real Estate Tax Public Hearing
Code of Virginia
58.1-3007
May 7, 2013 City Council 2
nd
City Council Work Session
May 14, 2013 City Council
3
rd
City Council Work Session
(If Necessary)
City Council Budget Approval
City of Norfolk
Charter Sec. 68; Code
of Virginia 15.2-2503
General Fund Budget Overview 23
G
ENERAL
F
UND
B
UDGET
O
VERVIEW
Real Estate Taxes
$201,739,800
24.9%
Other Property
Taxes
$50,238,400
6.2%
Consumer Taxes
$76,106,000
9.4%
Other City Funds
$186,985,927
23.0%
Other State Funds
$78,988,550
9.7%
State Funds for
Health and
Human Services
$32,597,266
4.0%
State and Federal
Funds for
Education
$184,848,783
22.8%
Other
Departments
and Services
$270,938,255
33.4%
Public Safety
$106,281,852
13.1%
Debt
Payments
$75,229,113
9.3%
Health and
Human Services
$51,112,897
6.3%
Education
$307,942,609
37.9%
24 Estimated General Fund Revenues by Source
E
STIMATED
G
ENERAL
F
UND
R
EVENUES
BY
S
OURCE
The following table compares the Proposed FY 2014 General Fund Operating Budget to the Approved FY 2013
General Fund Operating Budget and the FY 2012 Actual. Funding sources are shown by category to provide an
overview of the principal sources of revenue for the general operating fund of the city. These revenue sources
support general government operations. The tables and charts in the pages that follow show revenues and
expenditures for all funds.
1
The reduction in permits and fees is mainly due to the reclassification of recreation center and cruise ship terminal
fees to charges for services (“user fees”) to be consistent with the Commonwealth of Virginia Auditor of Public
Accounts recommended reporting classification. There is a corresponding increase in charges for services.
2
The reduction in federal aid from FY 2012 was largely due to the end of the federal Education Jobs Fund program.
Source
FY 2012
Actual
FY 2013
Approved
FY 2014
Proposed
FY 2013 vs. FY 2014
$ Change % Change
General Property Taxes 250,117,894 244,871,000 251,978,200 7,107,200 2.9%
Other Local Taxes 152,172,224 154,180,000 154,727,600 547,600 0.4%
Permits and Fees
1
4,020,697 4,427,928 2,350,340 -2,077,588 -46.9%
Recreation/Cruise Fees 1,698,470 1,987,928 0 -1,987,928 -100%
Fines and Forfeitures 1,106,931 1,235,800 1,203,300 -32,500 -2.6%
Use of Money and Property 6,949,563 6,903,200 7,226,500 323,300 4.7%
Charges for Services
1
34,426,938 35,908,538 38,372,254 2,463,716 6.9%
All Other - Charges for
Services
34,426,938 35,908,538 36,401,754 493,216 1.4%
Miscellaneous Revenue 8,604,908 8,904,776 9,781,303 876,527 9.8%
Recovered Costs 10,311,990 11,372,200 10,676,100 -696,100 -6.1%
Non-Categorical Aid - State 32,052,177 31,982,000 31,981,000 -1,000 0.0%
Shared Expenses - State 19,286,827 19,333,200 20,820,050 1,486,850 7.7%
Categorical Aid - State 233,560,052 237,923,794 239,087,828 1,164,034 0.5%
Federal Aid
2
12,967,183 6,805,200 6,539,621 -265,579 -3.9%
Other Sources and Transfers In 29,939,000 35,943,173 36,760,630 817,457 2.3%
General Fund Total 795,566,423 799,790,809 811,504,726 11,713,917 1.5%
Estimated General Fund Revenues by Source 25
Proposed
FY 2014 General Fund Revenues by Source
General Property
Taxes
31.1%
Categorical Aid -
State
29.5%
Federal Aid
0.8%
Other Sources and
Transfers In
4.5%
Other Local Taxes
19.1%
Permits and Fees
and Fines and
Forfeitures
0.4%
Use of Money and
Property
0.9%
Charges for
Services
4.7%
Miscellaneous
Revenue
1.2%
Recovered Costs
1.3%
Non-Categorical
Aid - State
3.9%
Shared Expenses -
State
2.6%
26 Estimated Revenues by Source (All Funds)
E
STIMATED
R
EVENUES
BY
S
OURCE
(A
LL
F
UNDS
)
The following table compares the Proposed FY 2014 Budget for All Funds as compared to the Approved FY 2013
Budget for All Funds and the FY 2012 Actual amount. Funding sources by category are shown to provide an
overview of the sources of revenue for all operating funds of the city. Revenues are contained in those categories
where they are originally raised.
1
The reduction in Federal Aid in FY 2013 and FY 2014 from FY 2012 is largely due to the end of the federal
Education Jobs Fund program.
Source
FY 2012
Actual
FY 2013
Approved
FY 2014
Proposed
FY 2013 vs. FY 2014
$ Change % Change
General Property Taxes 252,917,215 247,625,849 254,391,200 6,765,351 2.7%
Other Local Taxes 161,233,887 163,275,796 163,913,296 637,500 0.4%
Permits and Fees 5,460,720 5,843,208 3,759,640 -2,083,568 -35.7%
Fines and Forfeitures 3,446,057 3,185,812 4,272,910 1,087,098 34.1%
Use of Money and Property 8,219,520 8,267,292 8,559,277 291,985 3.5%
Charges for Services 181,853,735 194,451,250 198,400,310 3,949,060 2.0%
Miscellaneous Revenue 9,316,355 11,156,625 10,241,181 -915,444 -8.2%
Recovered Costs 14,108,476 14,788,068 14,159,353 -628,715 -4.3%
Non-Categorical Aid - State 32,052,177 31,982,000 31,981,000 -1,000 0.0%
Shared Expenses - State 19,286,827 19,333,200 20,820,050 1,486,850 7.7%
Categorical Aid - State 233,560,052 248,060,043 249,476,031 1,415,988 0.6%
Federal Aid
1
13,104,738 10,257,911 9,879,607 -378,304 -3.7%
Other Sources and Transfers In 31,648,213 45,821,461 47,175,042 1,353,581 3.0%
Subtotal 966,207,972 1,004,048,515 1,017,028,897 12,980,382 1.3%
Beginning in January 2014, the Healthcare Fund will collect premiums from Consortium members, their
employees, and participating retirees in order to provide healthcare services. Medical claims, administrative
costs, and wellness program expenditures will be charged to the fund. The budget impact is reflected below.
Healthcare Fund 0 0 57,931,973 57,931,973
Total All Funds 966,207,972 1,004,048,515 1,074,960,870 70,912,355 7.1%
Estimated Revenues by Source (All Funds) 27
FY 2014 Revenues by Source (All Funds)
Proposed
General Property
Taxes
23.7%
Other Local Taxes
15.2%
Categorical Aid -
State
23.2%
Federal Aid
0.9%
Other Sources and
Transfers In
4.4%
Healthcare Fund
5.4%
Note: Percentages have been rounded and may not total to 100.
Permits and Fees
and Fines and
Forfeitures
0.7%
Use of Money and
Property
0.8%
Charges for
Services
18.5%
Miscellaneous
Revenue
1.0%
Recovered Costs
1.3%
Non-Categorical
Aid - State
3.0%
Shared Expenses -
State
1.9%
28 Estimated Expenditures by Use (All Funds)
E
STIMATED
E
XPENDITURES
BY
U
SE
(A
LL
F
UNDS
)
The following table compares the Proposed FY 2014 Operating Budget to the FY 2013 Approved Operating Budget
and the FY 2012 Actual amount. Funding uses by category are shown to provide an overview of the principal uses
of expenditures for all operating funds of the city. Expenditures are contained in those categories where they are
originally spent.
1
The reduction in Public Assistance in FY 2014 and FY 2013 from FY 2012 is mainly due to the Commonwealth of
Virginia changing the reimbursement model for certain childcare programs. There is no anticipated reduction in
services to citizens.
Uses
FY 2012
Actual
FY 2013
Approved
FY 2014
Proposed
FY 2013 vs. FY 2014
$ Change % Change
Personnel Services 290,040,939 320,215,537 323,000,100 2,784,563 0.9%
Materials, Supplies and Repairs 62,649,779 67,956,293 70,314,650 2,358,357 3.5%
Contractual Services 65,364,083 72,104,936 75,750,705 3,645,769 5.1%
Equipment 3,453,352 5,751,896 5,282,133 -469,763 -8.2%
Department Specific
Appropriation
53,145,456 78,263,754 87,448,022 9,184,268 11.7%
Education 286,229,822 302,033,320 307,942,609 5,909,289 2.0%
Debt Service/Transfer to CIP 84,074,384 143,458,560 133,536,965 -9,921,595 -6.9%
Public Assistance
1
17,120,493 14,264,219 13,753,713 -510,506 -3.6%
Subtotal 862,078,308 1,004,048,515 1,017,028,897 12,980,382 1.3%
Beginning in January 2014, the Healthcare Fund will collect premiums from Consortium members, their
employees, and participating retirees in order to provide healthcare services. Medical claims, administrative
costs, and wellness program expenditures will be charged to the fund. The budget impact is reflected below.
Healthcare Fund 0 0 57,931,973 57,931,973
Total All Funds 862,078,308 1,004,048,515 1,074,960,870 70,912,355 7.1%
Estimated Expenditures by Use (All Funds) 29
Proposed
FY 2014 Expenditures by Use (All Funds)
Personnel Services
30.0%
Education
28.6%
Debt
Service/Transfers to
CIP
12.4%
Public Assistance
1.3%
Healthcare Fund
5.4%
Note: Percentages have been rounded and may not total to 100.
Materials, Supplies
and Repairs
6.5%
Contractual
Services
7.0%
Equipment
0.5%
Department
Specific
Appropriations
8.1%
30 Estimated Expenditures by Fund Type
E
STIMATED
E
XPENDITURES
BY
F
UND
T
YPE
The following table compares expenditures by fund type in the Proposed FY 2014 Operating Budget with the
Approved FY 2013 Operating Budget and the FY 2012 Actual amount.
Fund Type
FY 2012
Actual
FY 2013
Approved
FY 2014
Proposed
FY 2013 vs. FY 2014
$ Change % Change
General Fund 773,323,337 799,790,809 811,504,726 11,713,917 1.5%
Special Revenue Funds 31,224,838 60,831,546 60,875,771 44,225 0.1%
Enterprise Funds 96,420,049 129,768,060 130,992,500 1,224,440 0.9%
Internal Service Funds
1
12,835,188 13,658,100 13,655,900 -2,200 0.0%
Subtotal 913,803,412 1,004,048,515 1,017,028,897 12,980,382 1.3%
Beginning in January 2014, the Healthcare Fund will collect premiums from Consortium members, their
employees, and participating retirees in order to provide healthcare services. Medical claims,
administrative costs, and wellness program expenditures will be charged to the fund. The budget impact is
reflected below.
Healthcare Fund 0 0 57,931,973 57,931,973
Total All Funds (with
Healthcare Fund)
913,803,412 1,004,048,515 1,074,960,870 70,912,355 7.1%
Estimated Expenditures by Fund Type 31
Proposed
FY 2014 Expenditures by Fund Type (All Funds)
(Healthcare Fund is classified as "Internal Service")
General Fund
75.5%
Special
Revenue
Funds
5.7%
Enterprise
Funds
12.2%
Internal
Service Funds
1.3%
Hlth
Note: Percentages have been rounded and may not total to 100.
Healthcare
Fund
5.4%
32 Estimated General Fund Expenditures by Area
E
STIMATED
G
ENERAL
F
UND
E
XPENDITURES
BY
A
REA
The following table compares the Proposed FY 2014 General Fund Operating Budget to the Approved FY 2013
General Fund Operating Budget and the FY 2012 Actual amount. Major areas of service are shown to provide a
broad overview of the expenditures for the general operating fund of the City.
1
The decrease in Executive reflects the transfer of Communications and Public Information to General Management, where
there is a corresponding increase.
Service Area
FY 2012
Actual
FY 2013
Approved
FY 2014
Proposed
FY 2013 vs. FY 2014
$ Change % Change
Legislative 4,484,745 4,549,986 4,610,107 60,121 1.3%
Executive
1
5,644,262 6,413,572 4,386,029 -2,027,543 -31.6%
Law 3,895,805 3,930,466 4,042,520 112,054 2.9%
Constitutional Officers 5,320,064 5,532,679 5,628,097 95,418 1.7%
Judicial 45,704,467 47,334,967 49,215,440 1,880,473 4.0%
Elections 820,490 873,086 844,291 -28,795 -3.3%
General Management
1
33,474,585 37,660,490 40,691,547 3,031,057 8.0%
Non Departmental Appropriations 52,519,742 63,282,992 67,053,439 3,770,447 6.0%
Community Development 9,957,522 8,933,141 9,153,350 220,209 2.5%
Parks, Recreation and Cultural 41,316,505 41,399,471 42,313,852 914,381 2.2%
Public Health and Assistance 56,145,403 51,981,175 51,112,897 -868,278 -1.7%
Public Safety 104,729,741 105,766,540 106,281,852 515,312 0.5%
Public Works 41,201,038 42,000,527 42,999,583 999,056 2.4%
Debt Service 81,879,146 78,098,397 75,229,113 -2,869,284 -3.7%
Education 286,229,822 302,033,320 307,942,609 5,909,289 2.0%
General Fund Total 773,323,337 799,790,809 811,504,726 11,713,917 1.5%
Estimated General Fund Expenditures by Area 33
Proposed
FY 2014 General Fund Expenditures by Area
Legislative
0.6%
Executive
0.5%
Law
0.5%
Constitutional
Officers
0.7%
Judicial
6.1%
Elections
0.1%
General
Management
5.0%
Community
Development
1.1%
Education
37.9%
Public Health and
Assistance
6.3%
Public Safety
13.1%
Public
Works
5.3%
Debt Service
9.3%
34 Major Revenue Sources
M
AJOR
R
EVENUE
S
OURCES
Evaluating the city’s current and long-term financial health requires a review of the economy and major revenue
sources. Overall, General Fund revenues are projected to increase slightly. Moreover, overall real estate
assessments are projected to increase 0.11 percent in FY 2014, the first increase in three years.
E
CONOMIC
O
VERVIEW
The national economy grew at a slightly higher rate
in 2012. Real gross domestic product (GDP), which
is the broadest measure of economic activity, grew
2.2 percent in 2012 compared to 1.8 percent in
2011. The economy’s growth in 2012 was driven by
consumer spending, residential investment, and
business investment in structures, equipment and
software, and inventory. Residential investment’s
growth in 2012 was its first annual increase since
2005, an indication that the housing sector may
finally be on the path to recovery. However, the 1.4
percent decline in government spending at all
levels (federal, state and local) dampened the
economy’s growth in 2012 by 0.34 percentage
point. Although the economy is projected to grow through 2014 according to the Blue Chip Consensus forecast,
economic growth at least in 2013, will likely be curtailed by the uncertainty surrounding the sequester, federal debt
ceiling and federal budget deliberations.
The national economy continued to add jobs in 2012
and through March 2013. In 2012, the private sector
added 2.2 million jobs, slightly less than the revised 2.4
million jobs added in 2011. Although the public sector
continued to shed jobs in 2012, the 77,000 job loss in
2012 was much less than the 317,000 jobs lost in 2011.
Also, job losses decelerated in state and local
government. At the state level, about 2,000 jobs were
added in 2012, the first annual increase since 2008. At
the local level, about 34,000 jobs were lost in 2012
compared to 192,000 jobs lost last year. Since February
2010, the economy added about 5.9 million jobs or at
least two-thirds of the 8.7 million jobs lost between
January 2008 and February 2010. The increase has
mainly been in the private sector, which added 6.5 million jobs, while the public sector lost 605,000 jobs over the
same period. With employment continuing to be below pre-recession levels, the unemployment rate which stood
at 7.6 percent in March 2013 remains above pre-recession levels.
Virginia employment began to recover at mid-year of 2010. Through February 2013, the number of jobs in Virginia
has been growing year-over-year for 34 consecutive months, since May 2010. The revised employment figures for
Hampton Roads, released in March 2013, now show year-over job growth since February 2011. In 2012, the
number of jobs before seasonal adjustment in Virginia and in the region grew by 40,000 jobs (1.1 percent) and
6,100 jobs (0.8 percent), respectively. But like the nation, statewide and regional employment remain below pre-
recession levels. Moreover, the job gains may not be the same across the region. The Quarterly Census of
Major Revenue Sources 35
Employment and Wages (QCEW) as reported by the Virginia Employment Commission (VEC), showed that in the
third quarter of 2012 (the most recent data available), Hampton, Portsmouth, Suffolk and Virginia Beach gained
jobs, while Chesapeake, Norfolk, and Newport News lost jobs. The QCEW reports data on jobs and wages at the
national, state, and local level, and includes only jobs that are covered by unemployment insurance. Although the
Norfolk job loss in the third quarter was less than one percent, it was the second consecutive quarter when Norfolk
jobs did not grow (the number of jobs were flat in the second quarter of 2012). These two quarters were preceded
by five consecutive quarters of job growth.
Like the nation, the statewide, regional and local
unemployment rates have been trending downwards
but remained above pre-recession levels. VEC reported
that the unemployment rate before seasonal
adjustment in the state, region, and region’s seven
major cities all fell in February 2013 from the same
period last year. Moreover, Norfolk’s unemployment
rate in January 2013 was revised down by 0.1
percentage point to 8.0 percent - the same rate as in
January 2012. Prior to the revision, Norfolk
unemployment showed a 0.1 percentage point year-
over-year increase in January 2013, which would have
been the first such increase since August 2010.
The economic recovery continues to have a positive
impact on the Commonwealth’s fiscal condition.
Similar to last year, the state revised upwards its
revenue forecast in December for FY 2013 by $103.4
million (excluding transfers), which equates to a
revenue growth of 3.6 percent compared to the official
forecast of 2.9 percent growth from FY 2012. Although
the December forecast showed a downward revision of
FY 2014 revenues, the latest revenue estimate reflects
an upward revision of about $15 million from the
official forecast, which equates to a 3.9 percent
revenue growth in FY 2014 from the revised FY 2013
revenue forecast. Moreover, with the increase in state
resources, the Commonwealth restored the flexible
reduction in aid to localities that had been in place since FY 2009. In FY 2013, this particular reduction totaled
nearly $2.2 million in Norfolk. However, it may be awhile before all the reductions in state aid are restored.
Unlike the Commonwealth, Norfolk’s locally
generated revenues have not seen the same level of
recovery. This is because, like other localities, the city
is highly dependent on real property taxes, which
have been held back by the slow recovery of the
housing market. However, in FY 2014, the Real Estate
Assessor’s Office is estimating a 0.11 percent increase
in overall real estate assessments, the first increase in
three years. The increase though was curtailed
somewhat by the continued decline in residential
assessments. Although the average and median
sales price of homes sold in Norfolk increased in
2012 for the first time since 2007, residential
assessments typically lag the market. Also distressed
36 Major Revenue Sources
homes, which have held back home prices, still make up a significant portion of the homes for sale in the region.
However, the projected one percent decline in residential assessments is significantly less than the four percent
declines seen in each of the past three years.
The permitting of new residential structures in
Norfolk rose again in 2012. Housing units permitted
in single and multi-family structures both increased
in 2012. The value of those residential permits
increased in 2012 as well.
Moreover, permit values for new non-residential (that
is, commercial) construction also increased in 2012.
Commercial projects permitted in 2012 included the
first phase of the consolidated courts complex, Slover
Library, new Young Men’s Christian Academy (YMCA)
facility, Southside Aquatic Center, Sentara Leigh
Hospital, the Joan and Ray Kroc Center, and new fine
arts theatre at Norfolk Collegiate School. Permits for
nonresidential improvements were also issued for Norfolk International Airport, Monroe Building, and Chrysler
Museum. It is important to note that Norfolk is built out. Consequently, much of the building activity is mainly
redevelopment, infill development, and vertical expansion.
R
EVENUE
O
VERVIEW
The city generates revenue through taxes, user charges, and intergovernmental transfers from the state and federal
government. Over half of the city’s General Fund revenues are generated locally from various taxes and fees
including real estate, personal property, retail sales, permits, fines and user charges. These sources provide the
revenue to fund general services such as police, fire, parks and recreation, street maintenance, local commitment to
education, and human services.
The Commonwealth of Virginia provides approximately 36 percent of General Fund revenues which consist of
funding for dedicated purposes such as education, social services, transportation and constitutional officers, HB
599 funds for law enforcement, city’s share of personal property tax relief funds, and the tax on rental of cars also
make up revenue from the Commonwealth. As a result of the last economic downturn, the Commonwealth saw a
significant decline in revenues and in turn, reduced Direct Aid to education, HB 599, Constitutional Officers salaries
and benefits, jail per diems, and funds for street maintenance and eliminated the local share of ABC profits and
wine tax. Although the general assembly will be restoring the flexible cut to Norfolk’s state aid to localities that had
been in place since FY 2009, revenues from the Commonwealth continue to remain below pre-recession.
The remaining revenue comes from the federal government (mainly funds dedicated towards education),
recovered costs, inter-fund transfers, and carry-forward funds from accumulated savings. Inter-fund transfers
represent a return on investment from the Water and Wastewater utility operations. Carryforward funds are
generated through current and prior year savings.
Preliminary General Fund revenue projections, based on historical trends and the latest economic data, were
presented in February during the City Manager’s mid-year report on the budget. Projections were updated
through early April to incorporate the most recent information available. Estimates for each revenue source are
based on the analysis of the collection history and patterns, the underlying drivers that impact the revenue source,
and the overall economic environment projected for the city in the coming year. Revenue projections include a FY
2013 end of year estimate (“estimate”) and a FY 2014 estimate. The FY 2014 General Fund revenue estimate is $11.7
million (1.5 percent) above the FY 2013 budget, bringing total revenues to about $811.5 million. The FY 2014
Major Revenue Sources 37
estimate also includes the revenues from the National Maritime Center (subsequently referred to as “Nauticus” and
“Cruise Ship Terminal”), which have been incorporated into the General Fund since FY 2011.
1
The reduction in Permits and Fees is mainly due to the reclassification of recreation center and cruise ship
terminal fees to Charges for Services (“user fees”) to be consistent with the Commonwealth of Virginia Auditor of
Public Accounts recommended reporting classification. There is a corresponding increase in Charges for Services.
2
The reduction in federal aid from FY 2012 was largely due to the end of the federal Education Jobs Fund program.
R
EVENUE
M
ONITORING
Collection patterns for all of the city’s revenue sources are monitored throughout the year. Data from monthly
financial reports are monitored to determine the accuracy of budgetary projections. This allows for appropriate
administrative action if actual results differ substantially from projections. A detailed collections database is
compiled to project future revenue collections taking into account unique patterns and seasonal fluctuations.
Strong collection rates for locally generated taxes and fees reflect the commitment and fulfillment of responsibility
that Norfolk residents show to their city.
General Fund Revenues
Source
FY 2012
Actual
FY 2013
Approved
FY 2014
Approved
FY 2013 vs. FY 2014
$ Change % Change
General Property Taxes 250,117,894 244,871,000 251,978,200 7,107,200 2.9%
Other Local Taxes 152,172,224 154,180,000 154,727,600 547,600 0.4%
Permits and Fees
1
4,020,697 4,427,928 2,350,340 -2,077,588 -46.9%
Recreation/Cruise Fees
1
1,698,470 1,987,928 0 -1,987,928 -100%
All Other Permits and Fees 2,322,227 2,440,000 2,350,340 -89,660 -3.7%
Fines and Forfeitures 1,106,931 1,235,800 1,203,300 -32,500 -2.6%
Use of Money and Property 6,949,563 6,903,200 7,226,500 323,300 4.7%
1
34,426,938 35,908,538 38,372,254 2,463,716 6.9%
Recreation/Cruise Fees
1
0 0 1,970,500 1,970,500 100%
All Other Charges for Services 34,426,938 35,908,538 36,401,754 493,216 1.4%
Miscellaneous Revenue 8,604,908 8,904,776 9,781,303 876,527 9.8%
Recovered Costs 10,311,990 11,372,200 10,676,100 -696,100 -6.1%
Non-Categorical Aid - State 32,052,177 31,982,000 31,981,000 -1,000 0.0%
Shared Expenses - State 19,286,827 19,333,200 20,820,050 1,486,850 7.7%
Categorical Aid - State 233,560,052 237,923,794 239,087,828 1,164,034 0.5%
Federal Aid
2
12,967,183 6,805,200 6,539,621 -265,579 -3.9%
Other Sources and Transfers In 29,989,039 35,943,173 36,760,630 817,457 2.3%
General Fund Total 795,566,423 799,790,809 811,504,726 11,713,917 1.5%
38 Major Revenue Sources
G
ENERAL
P
ROPERTY
T
AXES
General property taxes are levied on the assessed value
of real and personal property and represent
approximately 31 percent ($251 million) of the city’s
General Fund revenues. Real estate taxes make up the
largest component of general property taxes. Current
real estate taxes make up about 22.6 percent ($183
million) of FY 2014 revenues and are up 3.6 percent from
the FY 2013 budget and 3.5 percent from the FY 2013
estimate. The growth reflects a two-cent increase in the
tax rate to $1.13 from $1.11 per $100 of assessed value
and capping the amount set aside to provide tax relief
to seniors/disabled residents and veterans to $5.0
million from $6.0 million in FY 2013.
Also, in FY 2014, overall real estate assessments are
projected to rise by 0.11 percent, after three consecutive
years of decline based on the preliminary estimate from
the Real Estate Assessor’s Office. However, residential
assessments (including condominiums) are projected to
decline for the fourth consecutive year, although the
decline in FY 2014 is much smaller than in the past three
years. Considerations about the city’s real estate
assessments and tax rate should also take into account
that about 36 percent of real property in the city is tax-
exempt, mainly due to federal land ownership.
$1.35
$1.38
$1.40
$1.35
$1.27
$1.11
$1.13
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Two-Cent Increase in Norfolk's Real Estate Tax
Major Revenue Sources 39
Norfolk lowered the real estate tax rate by 29 cents as assessments soared during FY 2006-FY 2008
Another key component of general property taxes is the
personal property tax, which is levied on all tangible
personal property, including motor vehicles, boats,
aircraft, business furnishings and office equipment.
Household goods and personal effects are exempt.
Personal property tax (current), which makes up 4.2
percent of FY 2014 revenues, is projected to increase
slightly by 0.7 percent ($250,000) from the FY 2013
estimate, as well as, personal property taxes overall,
current, delinquent collections, and refunds in total.
The FY 2014 estimate assumes no change in the general
tax rate on personal property at $4.33 per $100 of
assessed value. The FY 2014 estimate also assumes a 55 percent (55%) state car tax relief rate for tax year 2014 (that
is, tax bills due on June 5, 2014), which is anticipated to fully exhaust relief funds provided to the city by the
Commonwealth of Virginia under the Personal Property Tax Relief Act. This means that qualifying vehicles with an
assessed value of more than $1,000 would receive a 55 percent (55%) rate of tax relief on the vehicle’s first
$20,000 of assessed value. Qualifying vehicles with an assessed value of $1,000 or less would receive 100 percent
(100%) rate of tax relief. Prior to FY 2006, qualifying vehicles with an assessed value of more than $1,000 were
reimbursed for 70 percent of the total property tax eligible for relief. State legislation passed in 2004 capped car
tax relief funds statewide at $950 million beginning in FY 2006. Consequently, each locality in the state now
receives a fixed share of the $950 million of statewide personal property tax relief funds per state code. Each
locality’s share shall be determined based on the proportional share of actual personal property tax relief
payments received in tax year 2005, as certified by the Commonwealth of Virgnia Auditor of Public Accounts, of
which, Norfolk’s share is $16,871,056. Personal property tax relief funds received and not used in FY 2014 shall be
carried forward and used to increase the funds available for car tax relief. With the state capping the amount of
funds available for car tax relief, the percentage of the state reimbursement compared to the total tax is expected
to decrease over time and residents will pay an increasing share of the car tax.
7.8%
6.7%
3.7%
2.2%
0.5%
-0.3%
1.0%
0.8%
2.2%
3.5%
3.2%
4.0%
4.7%
5.9%
7.5%
10.5%
16.8%
24.9%
17.5%
5.8%
2.6%
-3.1%
-3.5%
-2.1%
0.1%
$1.35
$1.38
$1.40
$1.35
$1.27
$1.11
$1.13
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Fiscal Year
Real Estate Assessments (annual percent change) Real Estate Tax Rate
40 Major Revenue Sources
The machinery and tools tax is the remaining key
component of general property taxes and makes up
nearly one percent of the city’s General Fund revenue.
This tax is levied on machinery and tools used in
manufacturing, mining, radio and television
broadcasting, cable television, dry cleaning or laundry
businesses. Norfolk’s revenue from this source has been
fairly stable in the past few years. However, there have
been several attempts by state legislators in recent years
to curtail or eliminate entirely the ability of localities to
generate revenue from this source.
O
THER
L
OCAL
T
AXES
Other local taxes are comprised of consumer and business-based taxes, including excise taxes on utilities, sales,
hotel/motel, restaurant, admissions, and cigarettes, as well as franchise, business license, and recordation taxes. In
FY 2014, other local taxes are projected to make up about 19.1 percent ($154.7 million) of the city's General Fund
revenues. This revenue category, however, is sensitive to changes in economic conditions and are more likely to be
affected by sequestration and the end of the payroll tax cut than other revenue sources.
Sales tax, which makes up nearly four percent or $30.3
million of the city’s General Fund revenue, is levied on the
selling, distribution, use, or consumption of tangible
personal property, the leasing or renting of tangible
personal property and the storage of personal property
inside or outside Virginia that is for use in Virginia.
Revenue from this source is sensitive to the state of the
economy, household income, and underlying price level
changes. Current year estimates are used in projecting
next year’s revenues. Changes in the local retail market
(such as opening of new stores, performance of existing
stores, job growth, consumer confidence, and overall
economic health) are used for projecting this revenue.
Sales tax receipts are projected to increase moderately by 2.0 percent (or $600,000) over the FY 2013 estimate, as
the recovery of the economy continues.
Consumer utility taxes, which make up about five percent or $40.3 million of the city’s General Fund revenue, is
levied on the purchase of utility service including water, gas, and electricity. The tax is assessed on the amount
charged, exclusive of any federal tax. Monthly receipts are monitored and used as a basis for estimating the
revenue yield, taking seasonal variations into consideration. The consumer utility tax on telephones, cell phones
and cable TV were abolished and replaced by a statewide Communications Sales and Use Tax and the E-911 tax on
telephones was replaced by a uniform $0.75 tax per phone on January 1, 2007. In FY 2013, revenue from the
consumer utility tax and communications sales and use tax combined are projected to decline slightly by 1.0
percent (or $410,000) from the FY 2013 budget but is slightly above the FY 2013 estimate by 0.8 percent (or
$290,000). Since the inception of this tax, the revenue received from this source has fluctuated due to correction of
overpayments and underpayments by telecommunications service providers.
Major Revenue Sources 41
Taxes are collected on prepared meals. The tax rate is
6.5 percent of the value of the meal, with one
percentage point of the tax rate being allocated to
the Public Amenities Fund and the remaining 5.5
percentage points allocated to the General Fund.
Until the recent economic downturn, meals taxes
had been growing steadily due to the increase in the
number of restaurants that have opened citywide
including, downtown Norfolk and the Military
Highway corridor. In FY 2014, this revenue source is
projected to grow by 1.5 percent from the FY 2013
estimate and 2.5 percent from the FY 2013 budget.
Meals taxes make up 3.2 percent or $26.3 million of
FY 2014 General Fund revenues.
Hotel taxes are levied on hotel rooms rented. The
hotel tax rate is eight percent of the room rate. Like
the restaurant/meals tax, one percentage point is
allocated to the Public Amenities Fund and the
remaining seven percentage points are allocated to
the General Fund. In FY 2014, the hotel tax revenue is
projected to hold steady and has not varied
significantly in recent years. Hotel taxes make up 0.7
percent or $5.85 million of General Fund revenues.
The estimate, however, does not include the revenue
from the surcharge per room night, which was raised
by the City Council in FY 2012 from $1 to $2 per room
night. The city began collecting the bed tax on April
1, 2006 with the support of the Norfolk Hotel-Motel
Association. Revenue generated from the surcharge is designated evenly between Visit Norfolk (formerly Norfolk
Convention and Visitors Bureau) for visitor promotion and advertising for conventions and tourism in Norfolk and
the Norfolk Arts Consortium.
Business license taxes are collected from anyone who engages in a business, trade, profession, occupation or other
activity in the city. It is generally imposed as a percentage of gross receipts. It is also applied to individuals that
maintain a place of business, either permanent or temporary, or conduct a business-related activity. Rates vary
depending on business classification and amount of gross receipts generated. This revenue source (estimated to
be approximately $28.7 million in FY 2013) makes up 3.5 percent of General Fund revenues. It is projected to
increase 2.1 percent (or about $586,000) from the FY 2013 budget with the moderate recovery of the economy.
Cigarette taxes increased in FY 2012 due to the 10-cent tax rate increase from 65 cents to 75 cents per pack of 20
cigarettes approved by the City Council. The last time the City Council approved a tax rate increase was in FY 2008,
when the rate increased from 55 cents to 65 cents per pack of 20 cigarettes. However, the increase in revenue as a
result of the tax increase tends to be short-lived, since the tax increase may reduce smoking or induce smokers to
buy their cigarettes elsewhere. According to the Tax Foundation, cigarettes are considered to be highly susceptible
to border shopping because the cost of transporting them is so low. In FY 2014, cigarette taxes, which make up 0.9
percent or about $7.7 million of General Fund revenues, are projected to be flat from the FY 2013 budget.
P
ERMITS
AND
F
EES
Permits are issued to regulate new construction and ensure public safety. Permits, privilege fees, and licenses are
comprised of fees for permits, licenses and other privileges subject to city regulation, partially to cover the expense
42 Major Revenue Sources
of providing regulatory services (taxi permits, zoning inspections, construction permits, right-of-way, etc.) in the
city. Revenue from this source is projected to be about $2.4 million in FY 2014, which is about $2.1 million (or 47
percent) below the FY 2013 budget. Approximately $2.0 million of the difference is mainly due to the
reclassification of recreation center and cruise ship terminal fees to charges for services (“user fees”) to be
consistent with the Commonwealth of Virginia Auditor of Public Accounts recommended reporting classification.
Permits and fees represents less than one percent of General Fund revenues.
F
INES
AND
F
ORFEITURES
Fines and forfeitures mainly consist of revenues received from the courts as fines and forfeitures for violations of
city ordinances. These provide less than one percent (or approximately $1.2 million) of General Fund revenues.
C
HARGES
FOR
S
ERVICES
Charges for services consist of revenues from fees for services, including Zoo admission, the serving of legal papers
by local law enforcement officers, refuse disposal, court costs, paramedical rescue service, and miscellaneous
school fees. This revenue category is projected to be about $38.4 million in FY 2014, which is about $2.5 million (or
6.9 percent) above the FY 2013 budget. Approximately $2.0 million of the difference is mainly due to the
classification of recreation center and cruise ship terminal fees as charges for services from permits and fees to be
consistent with the Commonwealth of Virginia Auditor of Public Accounts recommended reporting classification.
Also, the proposed budget includes increasing the paramedic rescue (“ambulance”) fees to the allowable Medicare
rate. Charges for services represent about 4.7 percent of General Fund revenues and includes the revenues from
Nauticus and Cruise Ship Terminal.
U
SE
OF
M
ONEY
AND
P
ROPERTY
Revenue from the use of money and property is comprised primarily of interest earned on cash balances, rents from
short-term and long-term property leases, and prudent management of city assets. Revenue from this source
represents approximately 0.9 percent (or $7.2 million) of the city’s General Fund revenues and include the revenue
from Nauticus and Cruise Ship Terminal. The FY 2014 estimate is approximately $323,300 or 4.7 percent above the
FY 2013 budget; however, about half of the increase was due to the classification of Selden rent as use of money
and property from recovered costs to be consistent with the Commonwealth of Virginia Auditor of Public Accounts
recommended reporting classification.
R
ECOVERED
C
OSTS
Recovered costs consist of revenues recovered from expenses associated with employee costs, city and outside
agencies, and the public. In FY 2014, recovered costs are projected to be approximately $10.7 million and
constitute 1.3 percent of General Fund revenues. The FY 2014 estimate is 6.1 percent (or about $696,100) below the
FY 2013 budget. The decline is largely due to the federal interest subsidy from issuance of Qualified School
Construction Bonds (QSCB), reclassification of Selden rent as use of money and property, and one-time revenues
budgeted for FY 2013.
M
ISCELLANEOUS
R
EVENUE
Miscellaneous revenue consists of revenues that are not classified in the other categories. Included in this category
are revenue from payments in lieu of taxes, fee for services from the Navy housing public private venture, and
Major Revenue Sources 43
proceeds from land sales. In FY 2014, the city is expecting to receive about $9.8 million which makes up
approximately 1.2 percent of the General Fund revenues. The 9.8 percent (or about $876,500) increase in this
revenue category from the FY 2014 budget is mainly due to revenues that were one-time for FY 2013.
N
ON
-C
ATEGORICAL
A
ID
- V
IRGINIA
Non-Categorical aid contains state revenues that are generally shared with localities without restriction as to use.
In FY 2014, non-categorical aid is projected to be flat. Non-categorical aid makes up about 3.9 percent (or $32.0
million) of General Fund revenues.
S
HARED
E
XPENSES
Shared expenses consist of recovered costs from the Commonwealth for a portion of the salaries and benefits of
constitutional and other offices serving the Norfolk community, including the Norfolk Electoral Board, Sheriff, City
Treasurer, Commissioner of the Revenue, Clerk of the Circuit Court, and Commonwealth’s Attorney. The shared
expenses revenue category makes up about 2.6 percent ($20.8 million) of General Fund revenues. The 7.7 percent
(or $1.5 million) increase in FY 2014 reflects the restoration of Constitutional Officers’ portion of the flexible
reduction in aid to localities.
S
TATE
C
ATEGORICAL
A
ID
Categorical aid from the Commonwealth consists mainly
of revenues for education, public assistance grants and
social service programs, Virginia Department of
Transportation (VDOT) funding for street maintenance
and port funding, and local adult correctional facility.
Categorical Aid constitutes nearly 30 percent ($239.1
million) of General Fund revenues, with the majority
($180.3 million) earmarked for education. Categorical Aid
increased by about $1.2 million (or 0.5 percent) over the
FY 2013 budget. The majority of the increase was due to
state funding for education, road maintenance, and
restoration of the portion of the flexible reduction in aid
to localities that had been passed on to jail per diems.
Categorical aid for education includes the state sales and use tax and state school funds. State sales and use tax for
schools is the revenue from the city’s proportionate share of the one percent of the state sales and use tax,
designated for education purposes. Beginning July 1, 2012, the city’s share of the state sales and use tax will be
based on the population estimate provided by the Weldon Cooper Center for Public Service at the University of
Virginia. Additionally in FY 2005, half of the one-half cent sales and use tax increase approved by the General
Assembly was earmarked for local school systems and real estate tax relief. This amounts to an additional one-
quarter percent on the sales tax dedicated to schools. Half of that quarter percent is distributed in the same
manner as the one percent return discussed above. The other half of the quarter percent goes to support the
Standards of Quality (SOQ) which is included in state school funds. State school funds reflect schools operational
costs. The rate of reimbursements is based on the SOQ formula. Reimbursement rates vary by program and area of
emphasis. Changes in enrollment figures affect this revenue source. Localities are required to match the State
contribution based on a composite index. Currently, Norfolk funds more than its required share of local effort.
Categorical aid also includes the state reimbursements for the cost of operating the Department of Human
Services (DHS). Reimbursable costs include the cost of personnel, fringe benefits, non-personal services, rent for
44 Major Revenue Sources
buildings and parking, etc. The reimbursement rate of the overall costs varies by program. The FY 2014 estimate
and FY 2013 estimate for public assistance grants are significantly below what was received in FY 2012. This is
mainly due to changes the Virginia Department of Social Services had made in the middle of FY 2012 on how
reimbursements are handled in two childcare programs: (1) Fee Child Care and (2) TANF/VIEW Working and Trans
Child Care. The changes however, are not intended to reduce the level of child care services that will be provided.
The new system is an automated statewide system that will eliminate all involvement at the local social services
level. Previously, state funding was passed from the state through local departments of social services to child care
providers who manually filled out time/client reports to be reimbursed.
Jail per diem estimate is increasing in FY 2014 mainly due to the restoration of its portion of the flexible reduction in
aid to localities and not because of an increase in jail per diem rates, which were reduced significantly during the
2010 session of the General Assembly. Since March 1, 2010, per diem payments for local responsible inmates in
local or regional jails had declined to $4 per day from $8 per day, while the per diem payments for state inmates
housed in local jails had fallen to $12 per day from $8 or $14 per day. Payment for jail contract beds fell to $8 per
day (from $14 per day). The change in the per diem rates resulted in about a two million decline in jail funding
since FY 2010.
Categorical aid also includes funds for street construction and maintenance. The funds are received from VDOT to
maintain the city’s principal and minor arterials, collector roads and local streets based on moving lane miles. The
revenue is based on a statewide maintenance index of the unit costs used on roads and bridges. Changes in the
index are used to calculate and implement annual per-land-mile rates. The rates fluctuate on index changes and
number of miles assessed. These funds offset qualifying operating costs recorded in the city’s budget.
F
EDERAL
C
ATEGORICAL
A
ID
Federal categorical aid primarily consists of education funds from the federal government and is about 0.8 percent
($6.5 million) of FY 2014 General Fund revenues. The FY 2014 estimate of Federal aid has declined significantly
when compared to FY 2012 mainly due to the end of the funding from the Education Jobs Fund for Norfolk Public
Schools.
O
THER
S
OURCES
AND
T
RANSFERS
I
N
Other sources and transfers in consist of intra-governmental transfers and carry over funds, which total to about 4.5
percent ($36.8 million) of the city’s General Fund revenues. The estimate includes: transfers in from nongeneral
funds (which is about $11.8 million); carrying forward unspent appropriations from prior years, closeout of
accounts, and FY 2013 savings from the strategic realignment of departments (about $25.0 million).
Appropriations 45
A
PPROPRIATIONS
Department
FY 2014
Proposed
GENERAL FUND
LEGISLATIVE
City Council 382,588
City Clerk 1,386,492
City Real Estate Assessor 2,048,400
City Auditor 792,627
Total Legislative 4,610,107
EXECUTIVE
City Manager 2,356,952
Office of Budget and Grants Management 1,733,225
Office to End Homelessness 295,852
Total Executive 4,386,029
DEPARTMENT OF LAW 4,042,520
CONSTITUTIONAL OFFICERS (revenue related)
Commissioner of the Revenue 3,150,616
City Treasurer 2,477,481
JUDICIAL
Clerk of the Circuit Court 3,078,195
General District Court 269,798
Circuit Court Judges 663,643
Norfolk Juvenile Court Service Unit 197,009
Magistrate 24,152
Commonwealth's Attorney 5,575,209
Sheriff and Jail 39,327,144
Total Judicial 49,215,440
OFFICE OF ELECTIONS 844,291
GENERAL MANAGEMENT
Communications and Technology 13,424,725
Finance 3,495,078
General Services 20,447,850
Human Resources 3,323,894
Total General Management 40,691,547
46 Appropriations
NON-DEPARTMENTAL APPROPRIATIONS
Central Appropriations 24,213,798
Funds to Community Partners 1,929,763
Public-Private Partnerships for City-Owned Facilities 4,838,059
Public Partnerships to Provide Services 19,607,261
Contractual Obligations 4,382,226
Memberships and Dues 722,938
Other Arrangements 1,632,400
Total Non-Departmental Appropriations 67,053,439
Community Development
Planning and Community Development 7,276,417
Development 1,876,933
Total Community Development 9,153,350
PARKS, RECREATION and CULTURAL
Libraries 8,281,443
Cultural Facilities, Arts and Entertainment 6,590,471
Zoological Park 3,876,555
The National Maritime Center 5,535,500
Recreation, Parks and Open Space 18,029,883
Total Parks, Recreation and Cultural 42,313,852
PUBLIC HEALTH AND ASSISTANCE
Public Health 3,691,497
Human Services 47,421,400
Total Public Health And Assistance 51,112,897
PUBLIC SAFETY
Police 66,016,736
Fire-Rescue 40,265,116
Total Public Safety 106,281,852
PUBLIC WORKS 42,999,583
DEBT SERVICE 75,229,113
EDUCATION 307,942,609
Total General Fund 811,504,726
SPECIAL REVENUE FUNDS
Norfolk Community Services Board 26,765,042
Storm Water Management 14,838,301
Department
FY 2014
Proposed
Appropriations 47
Towing and Recovery Operations 1,703,928
Cemeteries 2,050,700
Golf Operations 1,497,600
Public Amenities 5,614,100
Emergency Preparedness and Response 5,993,100
Tax Increment Financing 2,413,000
Total Special Revenue Funds 60,875,771
ENTERPRISE FUNDS
Wastewater Utility Fund 27,231,300
Parking Facilities Fund 21,837,700
Total Enterprise Funds 130,992,500
INTERNAL SERVICE FUNDS
Fleet Management 13,655,900
Healthcare Fund 57,931,973
Total Internal Service Funds 71,587,873
TOTAL CITY OPERATIONS 1,074,960,870
TOTAL CAPITAL IMPROVEMENT PLAN 127,290,582
TOTAL APPROPRIATIONS 1,202,251,452
Department
FY 2014
Proposed
48 Tax Rates and Fees
T
AX
R
ATES
AND
F
EES
Description
FY 2013
Approved
FY 2014
Proposed
PROPERTY TAXES
Real Estate (General Tax) $1.11/$100 Assessed Value $1.13/$100 Assessed Value
Real Estate (Downtown Improvement
District)
$1.27/$100 Assessed Value $1.29/$100 Assessed Value
Personal Property
Airplane
$2.40/ $100 Assessed Value $2.40/ $100 Assessed Value
Motor Vehicle
$4.33/$100 Assessed Value $4.33/$100 Assessed Value
Recreational Vehicle
$1.50/$100 Assessed Value $1.50/$100 Assessed Value
Business Furniture, Fixtures, and
Equipment
$4.33/$100 Assessed Value $4.33/$100 Assessed Value
Watercraft - Business
$1.50/$100 Assessed Value $1.50/$100 Assessed Value
Watercraft - Recreational
$0.50/$100 Assessed Value $0.50/$100 Assessed Value
Machinery & Tools $4.25/$100 Assessed Value $4.25/$100 Assessed Value
OTHER LOCAL TAXES
Amusement and Admissions 10% 10%
Cigarette
75 cents/pack of 20 cigarettes
(37.5 mils/cigarette)
75 cents/pack of 20 cigarettes
(37.5 mils/cigarette)
Emergency 911 (Landline)
Replaced by the statewide E-911
tax rate of $0.75/line/month
Replaced by the statewide E-911
tax rate of $0.75/line/month
Hotel/Motel Lodging 8% 8%
Bed Tax $2 per room night $2 per room night
Food and Beverage 6.5% 6.5%
Motor Vehicle License:
Small Trailers (<2,000 pounds)
$6.50 $6.50
Motorcycles
$15.00 $15.00
Cars & Small Trucks
$26.00 $26.00
Semi Trailers
$20.00 $20.00
Mid-Size Trucks/Vans (>4,000 pounds)
$31.00 $31.00
Large Vehicles
(19,000 pounds and over)
$1.60-$1.80/1,000 pounds
of gross weight
$1.60-$1.80/1,000 pounds
of gross weight
Passenger (>10)
$0.30/100 pounds of weight
(not less than $26)
$0.30/100 pounds of weight
(not less than $26)
Tax Rates and Fees 49
REFUSE DISPOSAL
Residential
Single or Multiple Units (four units or less) $27.01/unit/month $27.01/unit/month
Multiple Units (five units or more) $45.27/container/month $45.27/container/month
Commercial
Business 1 times per week $59.00/unit/month $59.00/unit/month
Business 5 times per week $146.24/unit/month $146.24/unit/month
Combined Commercial and Residential $86.01/unit/month $86.01/unit/month
WATER AND WASTEWATER FEES
Wastewater $3.39/100 cubic feet $3.53/100 cubic feet
STORM WATER FEES
(rate calculated based on a 30-day month)
Residential $9.96/month $10.23/month
Commercial $7.18/month per 2,000 sq. ft. $7.35/month per 2,000 sq. ft.
UTILITY TAXES
Commercial
Gas
Rate/month: $3.225 +
$0.167821/CCF 0-70 CCF +
$0.15363/CCF on balance
(maximum of $500/month)
Rate/month: $3.225 +
$0.167821/CCF 0-70 CCF +
$0.161552/CCF 71-430 CCF +
$0.15363/CCF on balance
(maximum of $500/month)
Electricity
(Manufacturing)
Rate/month: $1.38 +
$0.004965/kWh 0-3,625,100 kWhs
+ $0.004014/kWh on balance
(maximum of $53,000/month)
Rate/month: $1.38 +
$0.004965/kWh 0-3,625,100 kWhs
+ $0.004014/kWh on balance
(maximum of $53,000/month)
Electricity
(Non-Manufacturing)
Rate/month: $2.87 +
$0.017933/kWh 0-537 kWh +
$0.006330/kWh on balance
Rate/month: $2.87 +
$0.017933/kWh 0-537 kWh +
$0.006330/kWh on balance
Telephone (Cellular, Landline)
Replaced by the State
Communications Sales & Use Tax
5% of sales price of services
Replaced by the State
Communications Sales & Use Tax
5% of sales price of services
Water
25% on first $75 plus 15% of bill in
excess of $75
25% on first $75 plus 15% of bill in
excess of $75
Residential
Cable and Satellite Service
Telephone (Cellular, Landline)
Replaced by the State
Communications Sales & Use Tax
Replaced by the State
Communications Sales & Use Tax
Electricity
$1.75 + $0.016891/kWh monthly
(capped at $3.75/month)
$1.75 + $0.016891/kWh monthly
(capped at $3.75/month)
Gas $1.50/month $1.50/month
Water (5/8" Meter) 25% on first $22.50/month 25% on first $22.50/month
Description
FY 2013
Approved
FY 2014
Proposed
50 General Fund Balance Reserves
G
ENERAL
F
UND
B
ALANCE
R
ESERVES
The establishment and maintenance of general operating reserves is considered one of the most effective
management practices a local government can employ.
The purpose of a reserve is to act as the city’s “savings” account to meet emergency, non-anticipated needs without
jeopardizing the ongoing provision of city services. Reserves help to cushion against cash flow challenges, as seen
in FY 2004 with the significantly large unexpected expenses of Hurricane Isabel, when the city appropriated $22.2
million from the General Fund undesignated fund balance to provide an interim source of funding for emergency
costs. The appropriate size of reserves depends on variability of revenues and expenditures and an organization’s
cash flow needs.
Because the city is self-insured, the Risk Management Reserve was created in the event of a major unanticipated
workers compensation or general liability claim. In FY 2008, the balance in the Risk Management Reserve was
reduced by $4.9 million from $5,740,162 to $840,162 to settle a major general liability claim. In FY 2010, the City
Council approved distributing $1,058,409 from a combination of FY 2008 and FY 2009 year-end undesignated
funds in accordance with the city’s practice to replenish the Risk Management Reserve. These funds raised the total
Risk Management Reserve balance to $1,898,571. In FY 2012, City Council strengthened the city’s reserves further
by raising the total General Fund balance reserves from $45,457,834 to $48,332,591. Included in the
comprehensive review and revision of the city’s financial practices and policies that began in the current fiscal year
are plans to meet the goals of our reserves. The Administration is in the process of requesting adoption of formal
financial policies by City Council.
* The amounts above exclude reserves for encumbrances and other legally restricted reserves and designations for
specific appropriations.
The goal for the FY 2013 unassigned reserve of $40,157,373 is based on the FY 2013 General Fund Budget of
$803,147,469, which reflects the City Council amendment to Norfolk Public Schools operating budget totaling
$3,356,660.
General Fund Balance Reserves
Reserve
FY 2012
Actual
FY 2013
Goal
FY 2013
Projected
Unassigned Reserve (“five percent reserve”) 42,332,591 40,157,373 42,332,591
Risk Management Reserve 3,000,000 11,600,000 3,000,000
Economic Downturn/Leveling Reserve 3,000,000 10,000,000 3,000,000
General Fund Balance Reserves at June 30* 48,332,591 61,757,373 48,332,591
Transfers From/To 51
T
RANSFERS
F
ROM
/T
O
The tables below present certain fund to fund transfers in FY 2014 which include: payments made by the General
Fund to support capital projects and special revenue funds; transfers from enterprise activities to the General Fund;
and transfers of funds to support capital projects.
Transfer from General Fund to FY 2014
Capital Improvement Program 609,666
Cemetery Fund 457,441
Emergency Preparedness and Response Fund 933,851
Golf Fund 436,893
Norfolk Community Services Board 5,971,395
Total Transfers from General Fund 8,409,246
Transfer to General Fund from
Water Fund 8,500,000
Wastewater Fund 1,500,000
Storehouse Fund closeout 1,750,000
Parking Fund 35,000
Total Transfers to General Fund 11,785,000
Transfer to Capital Improvement Program from
General Fund 609,666
Norfolk Public Schools (Camp Allen) 3,200,000
Public Amenities Fund 1,000,000
Parking Fund 2,900,000
Water Fund 885,000
Storm Water Fund 1,315,200
Total Transfers to the Capital Improvement Program 9,909,866
52 Personnel Staffing Summary
P
ERSONNEL
S
TAFFING
S
UMMARY
FY 2012
Approved
FY 2013
Approved
FY 2014
Proposed
1
Change
FY 2013 to
FY 2014
Total Positions by Department
General Fund
City Council 8880
City Clerk 14 14 14 0
City Real Estate Assessor 24 24 24 0
City Auditor 7880
City Manager 151515 0
Office of Budget and Management 16 20 20 0
Communications and Public Information
2
22 23 0 -23
Office to End Homelessness 3440
Commissioner of the Revenue 39 43 43 0
City Treasurer 313131 0
Clerk of Circuit Court 50 50 50 0
Circuit Court Judges 5550
Commonwealth’s Attorney 65 65 65 0
Sheriff and Jail 475 487 475 -12
Elections 6660
Communications and Technology
2
96 107 131 24
Finance 34 34 41 7
Human Resources 313031 1
Planning and Community Development 102 89 89 0
Development 181718 1
Libraries 78 91 101 10
Cultural Facilities, Arts & Entertainment 66 68 68 0
Zoological Park 56 57 55 -2
The National Maritime Center (Nauticus) 52 57 55 -2
Recreation, Parks and Open Space 215 226 224 -2
Cruise Ship Terminal 5000
Public Health 34 34 28 -6
Human Services 495 512 509 -3
Police
3
869 876 872 -4
Fire-Rescue
3
510 511 511 0
Public Works 335 345 336 -9
Total General Fund 3,912 4,007 3,977 -30
Personnel Staffing Summary 53
1
The FY 2014 column includes administrative changes which occurred during FY 2013 along with the FY 2014
budget actions. Prior year (FY 2013) position counts in the Personnel Staffing Summary will no longer be updated
with actions implemented during the course of the fiscal year so that all personnel changes between approved
budgets can be more accurately reflected.
2
The Department of Communications and Public Information and the Department of Information Technology
have been consolidated in FY 2014.
3
The Proposed FY 2014 Budget does not includ
4
The FY 2013 Norfolk Community Services Board (NCSB) position count was reported as an estimate in the
Approved FY 2013 Budget. As a result, the NCSB FY 2013 position count has been revised for accuracy from 290 to
310, and the overall FY 2013 position count has been revised from 5,071 to 5,091.
5
The Storehouse has been decentralized in FY 2014.
Only permanent positions are reflected in the Budget Document.
Special Revenue Funds
Norfolk Community Services Board
4
0310
4
310 0
Storm Water Management 85 88 96 8
Towing and Recovery Operations 9990
Cemeteries 35 35 34 -1
Emergency Preparedness and Response 90 91 91 0
Total Special Revenue Funds 219 533
4
540 7
Enterprise Funds
Water Utility Fund 289 289 293 4
Wastewater Utility Fund 104 104 104 0
Parking Facilities Fund 88 88 90 2
Total Enterprise Funds 481 481 487 6
Internal Service Funds
Storehouse
5
11 11 0 -11
Fleet 67 59 59 0
Total Internal Service Funds 78 70 59 -11
Total All Funds 4,690 5,091
4
5,063 -28
FY 2012
Approved
FY 2013
Approved
FY 2014
Proposed
1
Change
FY 2013 to
FY 2014
54 City Indebtedness
C
ITY
I
NDEBTEDNESS
The Virginia Constitution authorizes cities and counties in Virginia to issue general obligation bonds secured by a
pledge of its full faith and credit. For the payment of such bonds, the governing body of the city is required to levy
an ad valorem tax on all property subject to local taxation to ensure debt service payment. The issuance of general
obligation bonds is subject to a limit of 10 percent of the assessed value of taxable real property in the city.
The Public Finance Act of Virginia authorizes a city in Virginia to issue limited liability revenue bonds provided that
the rates, rents, fees or other charges are sufficient to pay the cost of operation and administration and the principal
and interest on the bonds when due. In determining general obligation statutory debt limitations, certain classes of
indebtedness may be excluded, including revenue anticipation notes maturing in one year or less, general
obligation bonds payable from a specified revenue producing undertaking, so long as the undertaking is self-
supporting, capital leases and revenue bonds. The city's enterprise operations for Water, Wastewater, and Parking
bonded debt are a combination of self-supporting, general obligation and revenue bonds. The city's operations for
Storm Water, Maritime, and Towing and Recovery bonded debt are intended to be self-supporting general
obligation bonds.
The following table shows the estimated general obligation Legal Debt Margins for the current fiscal year as of June
30, 2013, and for the past four fiscal years.
(1) The figure includes the assessed valuation of the following properties: public service corporations (as assessed by the State
Corporation Commission and the Virginia Department of Taxation); and residential, commercial, apartments and vacant land (as
assessed by the City Assessor).
(2) Taxable Real Property Assessed Value is estimated as of March 31, 2013.
(3) Projected Debt Applicable to Debt Limit excludes $201,015,287 of General Obligation Bonds authorized by ordinance for
Capital Improvement Projects, but not yet issued.
O
VERLAPPING
D
EBT
The City of Norfolk is autonomous and independent of any county or other political subdivision and is not subject
to taxation by any county or school district, nor is it liable for any county or school division indebtedness. There is
no overlapping debt.
S
TATEMENT
OF
N
O
P
AST
D
EFAULT
The city has never defaulted on the payment of either principal or interest on any debt.
As of
Taxable Real
Property Assessed
Value
(1)
Debt Limit: 10% of
Assessed Value
Debt Applicable
to Debt Limit
Amount of
Debt as % of
Debt Limit
Legal Margin for
Additional Debt
June 30, 2013
(2)(3)
18,306,775,078 1,830,677,508 818,068,050 44.69% 1,012,609,458
June 30, 2012 18,676,730,533 1,867,673,053 877,060,431 46.96% 990,612,622
June 30, 2011 19,320,643,495 1,932,064,350 829,621,927 42.94% 1,102,442,422
June 30, 2010 19,940,273,451 1,994,027,345 889,556,676 44.61% 1,104,470,669
June 30, 2009 19,397,795,455 1,939,779,546 739,006,679 38.10% 1,200,712,867
City Indebtedness 55
O
UTSTANDING
D
EBT
Debt service for General Capital Improvements is funded from the General Fund. The debt of the enterprise and
other fee-supported operations are paid from their respective revenues. The estimated total outstanding bonded
indebtedness, including revenue bonds, at the end of FY 2013 is estimated to be $1,280,663,050.
G
ENERAL
C
APITAL
I
MPROVEMENTS
–A
FFORDABILITY
M
EASURES
The Capital Improvement Plan for General Capital Improvements (those bonds not supported by self-supporting
user fees) is guided by two measures of affordability. These measures or debt limits, based on the approved Capital
Improvement Plan, are as follows:
• Debt Service as a percent of the General Fund budget (not to exceed 10 percent) and
• Net debt as a percent of taxable real estate (not to exceed 3.5 percent)
The FY 2014 Capital Improvement Plan is within the two measures of affordability listed above. However, in order
to finance some major essential governmental projects, such as, a new city courthouse, several schools and a new
main library, the city may be challenged to stay within these measures in the out years of the Capital Improvement
Plan.
E
NTERPRISE
O
PERATIONS
D
EBT
Norfolk's Water, Wastewater and Parking Revenue Bond programs are governed by bond indentures of trust, which
specify debt coverage requirements for their respective operations. Each of the revenue bond programs are
backed by the revenues of their respective system. The city has covenanted in each respective indenture that it will
establish, fix, charge and collect rates, fees and other charges so that in each Fiscal Year Net Revenues are not less
than the debt service coverage requirement. All Revenue Bond Programs, historically and estimated for FY 2014
meet debt coverage requirements. As previously noted, outstanding Water, Wastewater and Parking bonds are a
combination of general obligations of the city and revenue bonds. As a matter of practice, the city pays such
general obligation bonds from its respective enterprise activities. In the event that money in the respective funds
is not sufficient to pay debt service on the general obligations, the city is obligated to pay such debt service from
the General Fund or other available revenues.
B
OND
R
ATINGS
Bond or credit ratings are an independent opinion of the general creditworthiness of an issuer, such as the city,
based on relevant risk factors. Long-term general obligation ratings are based on an issuer's ability and willingness
to repay fully the principal and interest of its debt obligations, on a timely basis. Municipal credit ratings are
primarily based on four main factors: the issuer's financial position, the issuer's current and future debt burden,
financial management and the economy. Often an investor places significant emphasis on a bond's credit rating to
help evaluate a price or willingness to hold the investment.
Each of the three major credit rating agencies in the U.S.: Moody's Investors Service ("Moody's”), Standard and
Poor's ("S&P") and Fitch Ratings ("Fitch") applies its own methodology in measuring creditworthiness and uses a
specific rating scale to communicate its ratings opinions. Typically, ratings are expressed as letter grades that
range, for example, from 'AAA' to 'D' to communicate the agency's opinion of relative level of credit risk. Credits are
56 City Indebtedness
further distinguished with "notches" within each rating category.
Credit ratings for the city’s General Obligation
and Water Revenue Bond programs are as follows:
Norfolk's rating on its General Obligations Bonds of Aa2/AA/AA+ and its Water Revenue Bonds of Aa2/AA+/AA+ are
very strong. In general, AA category rating signifies very high quality bonds with some elements of long-term risks.
Neither the Parking Revenue Bonds nor the Wastewater Revenue Bonds maintain an underlying, or stand-alone
unenhanced, credit rating.
(1)
Gross Debt Applicable to Debt Limit excludes $201,015,287 of General Obligation Bonds authorized by ordinance for Capital
Improvement Projects, but not yet issued.
Bonding Program
Moody’s Investors
Service Standard and Poor’s Fitch Ratings
General Obligation Aa2 AA AA+
Water Revenue Aa2 AA+ AA+
Computation of Legal Debt Margin
June 30, 2013 (Estimated)
Total Assessed Value of Taxed Real Property as of March 31, 2013 $18,306,775,078
Debt Limit - 10 percent of Total Assessed Value $1,830,677,508
Amount of Debt Applicable to Debt Limit:
Gross Debt
(1)
$733,504,227
General Obligation (QRBs) 7,805,000
General Obligation Bond Anticipation Notes 75,305,000
General Obligation (QZABs) 463,824
General Obligation (Guaranty) 990,000 $818,068,050
Legal Debt Margin $1,012,609,458
Amount of Debt as a percent of Debt Limit 44.69%
Yearly Maturity of Long-Term Debt 57
Y
EARLY
M
ATURITY
OF
L
ONG
-T
ERM
D
EBT
Fiscal
Year
General Obligation
(1)(2)(3)
General Obligation Equipment
(1)
Water Revenue
(1)
Principal Interest Total Principal Interest Total Principal Interest Total
2013
54,264,324 32,851,106 87,115,431 4,443,057 402,271 4,845,328 7,000,000 14,700,777 21,700,777
2014
52,903,956 32,280,381 85,184,338 3,227,851 348,936 3,576,787 7,250,000 15,630,219 22,880,219
2015
53,746,787 30,172,029 83,918,816 2,236,785 285,004 2,521,789 7,805,000 15,398,269 23,203,269
2016
48,942,394 27,906,992 76,849,386 2,054,822 201,949 2,256,771 8,750,000 15,047,794 23,797,794
2017
49,036,600 25,753,018 74,789,618 1,550,460 114,347 1,664,807 10,655,000 14,591,519 25,246,519
2018
47,300,563 23,669,899 70,970,461 815,000 78,396 893,396 13,860,000 13,994,269 27,854,269
2019
47,116,600 21,484,430 68,601,030 215,000 52,550 267,550 14,820,000 13,291,244 28,111,244
2020
45,925,189 19,578,300 65,503,489 225,000 42,625 267,625 15,665,000 12,546,769 28,211,769
2021
43,920,302 17,572,944 61,493,246 235,000 31,125 266,125 16,760,000 11,751,144 28,511,144
2022
43,039,124 15,812,121 58,851,244 245,000 19,125 264,125 17,740,000 10,910,144 28,650,144
2023
41,614,846 13,912,961 55,527,807 260,000 6,500 266,500 19,005,000 10,013,444 29,018,444
2024
40,317,532 12,086,302 52,403,834
- - -
20,140,000 9,048,894 29,188,894
2025
36,163,461 10,354,822 46,518,284
- - -
18,170,000 8,106,769 26,276,769
2026
33,218,857 8,696,812 41,915,669
- - -
19,270,000 7,187,044 26,457,044
2027
32,179,941 7,115,851 39,295,792
- - -
12,065,000 6,420,613 18,485,613
2028
27,191,981 5,681,570 32,873,551
- - -
12,735,000 5,818,263 18,553,263
2029
17,240,000 4,327,310 21,567,310
- - -
13,480,000 5,185,306 18,665,306
2030
17,385,000 3,412,932 20,797,932
- - -
8,640,000 4,662,619 13,302,619
2031
17,525,000 2,534,027 20,059,027
- - -
9,070,000 4,255,050 13,325,050
2032
3,350,000 1,654,198 5,004,198
- - -
9,535,000 3,827,228 13,362,228
2033
14,175,000 1,169,799 15,344,799
- - -
7,850,000 3,421,959 11,271,959
2034
2,580,000 828,788 3,408,788
- - -
8,230,000 3,041,106 11,271,106
2035
2,660,000 696,456 3,356,456
- - -
8,630,000 2,641,750 11,271,750
2036
2,750,000 560,022 3,310,022
- - -
9,050,000 2,225,653 11,275,653
2037
2,840,000 418,256 3,258,256
- - -
8,050,000 1,825,281 9,875,281
2038
2,935,000 272,504 3,207,504
- - -
8,435,000 1,441,775 9,876,775
2039
930,000 209,250 1,139,250
- - -
8,835,000 1,042,831 9,877,831
2040
930,000 162,750 1,092,750
- - -
5,505,000 713,850 6,218,850
2041
930,000 116,250 1,046,250
- - -
5,760,000 461,625 6,221,625
2042
930,000 69,750 999,750
- - -
3,260,000 252,750 3,512,750
2043
930,000 23,250 953,250
- - -
3,425,000 85,625 3,510,625
2044 - - - - - - - - -
784,972,456 321,385,081 1,106,357,537 15,507,975 1,582,827 17,090,803 339,445,000 219,541,580 558,986,580
58 Yearly Maturity of Long-Term Debt
(1)
Existing Debt Service as of June 30, 2013. Excludes any future issuances.
(2)
Figures exclude debt service due on $75,305,000 General Obligation Bond Anticipation Notes, Series 2011A and 2011B, to
better match the useful life of the assets financed by refinancing the principal over a longer period prior to the January 1, 2014.
(3)
General Obligation bonds have been used to finance Water, Wastewater, Parking, Storm Water, Maritime, and Towing and
Recovery projects. The bonded debt associated with those projects is self-supported by their respective funds. The Debt
Service portion of the General Fund budget finances only the General Capital projects and not its self-supporting funds.
Fisca
l Year
Parking Revenue
(1)
Wastewater Revenue
(1)
Totals
(1)
Principal Interest Total Principal Interest Total Principal Interest Total
2013
2,690,000 4,051,025 6,741,025 1,725,000 - 1,725,000 70,122,381 52,005,179 122,127,560
2014
2,835,000 3,918,825 6,753,825 1,957,500 - 1,957,500 68,174,307 52,178,361 120,352,668
2015
2,970,000 3,779,000 6,749,000 2,490,000 - 2,490,000 69,248,572 49,634,302 118,882,874
2016
3,085,000 3,654,300 6,739,300 2,790,000 - 2,790,000 65,622,217 46,811,035 112,433,251
2017
3,240,000 3,512,000 6,752,000 2,790,000 - 2,790,000 67,272,060 43,970,883 111,242,943
2018
3,385,000 3,362,550 6,747,550 2,790,000 - 2,790,000 68,150,563 41,105,114 109,255,676
2019
3,545,000 3,206,375 6,751,375 2,790,000 - 2,790,000 68,486,600 38,034,599 106,521,198
2020
3,755,000 3,056,075 6,811,075 2,790,000 - 2,790,000 68,360,189 35,223,769 103,583,958
2021
3,945,000 2,871,725 6,816,725 2,790,000 - 2,790,000 67,650,302 32,226,938 99,877,240
2022
4,145,000 2,678,025 6,823,025 2,790,000 - 2,790,000 67,959,124 29,419,414 97,378,538
2023
4,350,000 2,474,013 6,824,013 2,790,000 - 2,790,000 68,019,846 26,406,917 94,426,763
2024
4,555,000 2,259,400 6,814,400 2,790,000 - 2,790,000 67,802,532 23,394,595 91,197,128
2025
4,780,000 2,034,650 6,814,650 2,790,000 - 2,790,000 61,903,461 20,496,241 82,399,702
2026
5,025,000 1,797,725 6,822,725 2,790,000 - 2,790,000 60,303,857 17,681,581 77,985,438
2027
5,275,000 1,548,650 6,823,650 2,790,000 - 2,790,000 52,309,941 15,085,114 67,395,054
2028
4,840,000 1,287,175 6,127,175 2,790,000 - 2,790,000 47,556,981 12,787,007 60,343,988
2029
5,100,000 1,032,375 6,132,375 2,790,000 - 2,790,000 38,610,000 10,544,991 49,154,991
2030
5,195,000 763,850 5,958,850 2,365,000 - 2,365,000 33,585,000 8,839,401 42,424,401
2031
5,480,000 485,000 5,965,000 1,940,000 - 1,940,000 34,015,000 7,274,077 41,289,077
2032
945,000 190,825 1,135,825 1,565,000 - 1,565,000 15,395,000 5,672,251 21,067,251
2033
990,000 146,425 1,136,425 1,065,000 - 1,065,000 24,080,000 4,738,183 28,818,183
2034
1,035,000 99,900 1,134,900 832,500 - 832,500 12,677,500 3,969,794 16,647,294
2035
1,090,000 51,250 1,141,250 300,000 - 300,000 12,680,000 3,389,456 16,069,456
2036
- - - - - -
11,800,000 2,785,675 14,585,675
2037
- - - - - -
10,890,000 2,243,537 13,133,537
2038
- - - - - -
11,370,000 1,714,279 13,084,279
2039
- - - - - -
9,765,000 1,252,081 11,017,081
2040
- - - - - -
6,435,000 876,600 7,311,600
2041
- - - - - -
6,690,000 577,875 7,267,875
2042
- -
4,190,000 322,500 4,512,500
2043
- -
4,355,000 108,875 4,463,875
2044
- - - - - - - - -
82,255,000 48,261,138 130,516,138 53,300,000 - 53,300,000 1,275,480,431 590,770,626 1,866,251,057